US 10Y Bond Yield Hits 4-week High

The yield on the 10-year US Treasury note was at 5.15% on Friday, holding a 30bps surge on the week as evidence of high inflation consolidated bets of more rate hikes by the Federal Reserve. The latest PPI data showed that headline and core annual inflation rates are at their highest in three years, maintaining the hawkish pressure from the hot CPI released earlier in the week. The rise in core consumer prices indicated that the surge in energy prices was impacting other areas of the economy, driving FOMC members to signal that higher rates are warranted. Meanwhile, Treasury yields in the belly of the curve surged after Jensen Huang resigned as president and CEO of Nvidia, sparking fears of turmoil in the debt-laden AI sector. Because Nvidia has anchored and backstopped a massive wave of AI-related corporate bond issuance, a sudden freeze in the sector's credit activity risked triggering broader fixed-income selloffs as investors liquidated positions.

US 10 Year Government Bond Yield increased to 5.16%, the highest since October 2026. Over the past 4 weeks, US 10 Year Note Bond Yield lost 2.80 basis points, and in the last 12 months, it increased 101.10 basis points.

The yield on the 10-year US Treasury note held above 5.1% on Friday, hovering at three-week highs amid growing expectations for a faster pace of Federal Reserve policy tightening. The upward move followed hotter-than-expected US consumer inflation data and hawkish remarks from Fed officials, with some policymakers suggesting that a larger 50-basis-point rate increase may be needed to bring inflation under control. Markets are currently pricing in around an 85% probability of a 25-basis-point rate hike in December, while the likelihood of a larger 50-basis-point increase stands at around 15%. Investors are also increasingly anticipating further rate hikes next year. Market participants are now awaiting US PPI data for additional insights into inflationary pressures. Meanwhile, oil prices rebounded as President Donald Trump declared that the US no longer needs a deal with Iran, adding to upward pressure on Treasury yields.