The US 10-year Treasury yield has risen above 5%. The prolonged war has kept energy prices elevated and heightened inflation concerns, raising concerns that higher mortgage rates could affect household finances and business activity.
The last time the yield exceeded 5% was during the economic stimulus measures introduced after the COVID-19 pandemic, but this time the prolonged war is considered the main cause. The 10-year Treasury yield rose above 5% on the 14th, forcing investors to assess whether the bond market is entering a new era.
The rise in yields is expected to have broad repercussions for consumers and companies, and could also affect the midterm elections. Mortgage rates have already been pushed close to 7%, leading some to believe that changes in fiscal and financial conditions will hit household finances directly.
Treasury Secretary Scott Bessent is reported to have taken unusual measures to contain yields, but they have had little visible effect so far. This has prompted renewed questions about market confidence and the sustainability of monetary policy.