Treasury Yields Rise for 2nd Session

The yield on the US 10-year Treasury note edged up to 4.58% on Wednesday, its highest level since late May, after climbing 8 basis points in the previous session. Treasury yields rose as escalating tensions in the Middle East drove oil prices sharply higher, fueling concerns that renewed inflationary pressures could require further monetary tightening. Oil prices have surged almost 10% over the past two sessions, with President Trump declaring that, "as far as I'm concerned, the ceasefire is over". The US also launched fresh strikes on Iran and revoked a waiver that had allowed the country to sell crude on global markets. The latest escalation followed a series of attacks on vessels transiting the Strait of Hormuz, heightening fears of disruptions to global oil supplies. Meanwhile, traders increased their expectations for Federal Reserve rate hikes, with the implied probability of a September increase rising to around 70%, up from 58% the previous day.

US 10 Year Government Bond Yield increased to 4.58%, the highest since June 2026. Over the past 4 weeks, US 10 Year Note Bond Yield gained 4.60 basis points, and in the last 12 months, it increased 22.80 basis points.

The yield on the US 10-year Treasury note remained near a one-month high of around 4.55% on Wednesday after climbing sharply in the previous session, as renewed US air strikes on Iran drove oil prices higher, fueling inflation concerns and reinforcing expectations of interest rate hikes. The latest military action followed recent attacks on ships transiting the Strait of Hormuz, while Washington also revoked a waiver that had allowed Iran to sell crude on global markets. Meanwhile, investors awaited the minutes of the Federal Reserve’s June meeting for additional insight into the policy outlook after the central bank struck a more hawkish tone at its June meeting. Markets are now pricing in roughly a 50% chance of a Fed rate increase in September, up from around 46% a day earlier. Separately, data released on Tuesday showed the US trade deficit widened to $77.6 billion in May, the largest gap since March 2025.