[UPDATE] 10-year Treasury yield passes 5.2%, near a 24-year high, as oil rises after Trump rejects Iran's Hormuz offer
The 30-year Treasury bond yield is above 5.5%, and the rise in borrowing costs weighed on stocks.
The yield on the 10-year Treasury note passed 5.2% on Monday, Sept. 28, close to its highest level in 24 years. That yield is the interest rate investors charge to lend Washington money for 10 years, and home-loan rates track it. The oil. Oil prices rose after Donald Trump rejected Iran's offer to reopen the Strait of Hormuz. Worries about deficits and inflation added to the pressure on bonds. The auctions. Buyers also got pickier. Last week's 5-year note sale (Wed Sept. 23) paid the highest yield since June 2006, and the 7-year sale (Thu Sept. 24) paid the highest since 1993. The 5-year was the weak one: primary dealers (the big banks required to bid) were left holding 15.8% of it, about $11 billion. The 7-year held up closer to normal: dealers took 12.5%, in line with recent sales. What next. Treasury sells 10-year notes again on Wednesday, Oct. 7, and 30-year bonds on Thursday, Oct. 8.
PREVIOUSLY
- Sept. 4 — The 10-year yield stood at 4.79%.
- Sept. 16 — The Fed raised its key rate a quarter point, to a 3.75%-4.00% range.
- Sept. 23 — The 5-year note sold at 5.033%, up from 4.393% in August. Bid-to-cover (dollars bid per dollar sold) was 2.21, against a 2.33 six-month average and the weakest for this note since December 2018. Indirect bidders, a group that includes foreign buyers, took 54.3% against a 63.9% 12-month average, the lowest since March 2020.
- Sept. 24 — The 7-year note sold at 5.085%, up from 4.512% in August. Its bid-to-cover was 2.42, against 2.50 in August.