Higher inflation reports pushed U.S. Treasury yields on Friday to rates not seen since the run-up to the 2008 financial crisis. Yields on the 30-year Treasury rose to 5.13 percent, the highest since June 2007. The 10-year yield jumped to 4.59 percent, the highest since May 2025.
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The rise in rates comes in the wake of increasing consumer, producer, and import–export prices. The Consumer Price Index jumped to 3.8 percent according to data released this week, the highest since May 2023.
Fears over higher inflation pushed investors to demand higher yields on treasuries, a benchmark for borrowing costs like mortgages.
Debt financing continues to impose an increasing burden on the Treasury and Federal Reserve, as interest alone on the national debt grew higher than defense spending in fiscal year 2024. The federal government’s refinancing of this debt pushes treasury rates higher as the risk of failure to repay grows.
These pressures put further challenges on President Donald Trump’s appointed Fed chair, Kevin Warsh, who wishes to wind down the central bank’s balance sheet while cutting interest rates.
