US 10-Year Yield Holds Near 5%

The yield on the 10-Year US Treasury note held just below 5% on Tuesday after rising for four consecutive sessions, as elevated oil prices fueled inflation concerns ahead of an expected interest rate hike by the Federal Reserve this week. The benchmark yield is also approaching its highest levels since 2007. Oil prices resumed their climb as Saudi Arabia’s East-West pipeline remained shut, while Ukraine disputed President Trump’s claim that it had already reached an agreement with Russia to halt attacks on energy infrastructure. Meanwhile, markets are pricing in roughly a 92% probability of a 25-basis-point rate hike by the Fed on Wednesday, following hotter-than-expected inflation data last week. Long-term yields were also pushed higher by surging corporate debt issuance from AI companies, which has constrained capital allocation by primary dealers and other financial institutions.





