New York, May 21, 2026, 02:53 EDT
30-year U.S. Treasury yields stayed close to 2007 highs early Thursday, as bond investors remained nervous following another rough period marked by inflation worries, higher oil prices, and less talk of Federal Reserve rate cuts.
The long end of the Treasury market, meaning debt set to mature in 10 years or more, drives borrowing costs for mortgages, business loans, and for the government itself. The yield is what investors want in return for holding a bond. It goes up as the bond’s price drops.
The Wall Street Journal said early Thursday the 30-year Treasury yield was up 1.4 basis points at 5.128%. The 10-year yield rose 2.3 basis points to 4.593%. The two-year yield added 3 basis points to 4.067%. A basis point equals one-hundredth of a percentage point.
30-year Treasury par yields fell to 5.11% Wednesday from 5.18% Tuesday, according to official Treasury data. The 10-year yield dropped to 4.57% from 4.67% over the same period. Treasury calculates constant-maturity yields from bid-side quotes around 3:30 p.m. each day.
Treasury yields and oil prices dropped Wednesday as investors grew more confident about a U.S.-Iran deal, fueling a short rally. The 10-year yield lost 9.4 basis points to 4.576% for the day, after hitting a 16-month high Tuesday, according to Reuters. 30-year yields were also at their highest since 2007.
Housing is starting to feel the squeeze. The Mortgage Bankers Association said the average 30-year fixed mortgage rate climbed 10 basis points to 6.56% for the week ended May 15, the highest level in seven weeks. Mortgage applications dropped 2.3%. Mortgage rates usually move more in line with the 10-year Treasury than the Fed’s policy rate.
Wall Street analysts aren’t calling a bottom yet. Gregory Faranello, who runs U.S. rates strategy at AmeriVet Securities, told Reuters “this selloff can definitely continue.” Padhraic Garvey, ING’s head of global rates and debt strategy, sees the 10-year yield pushing toward 4.75%. At BNP Paribas, Guneet Dhingra said the 30-year yield had “no anchor” once it broke above 5%. Reuters
Fed minutes out Wednesday offered nothing new for bond investors looking for relief. Most policymakers said more policy firming could be needed if inflation keeps running above 2%. Many pushed to cut language hinting at an easing bias. The Fed kept its target range at 3.50%-3.75% after the April 28-29 meeting.
Treasury Secretary Scott Bessent pushed back on the bleak outlook some in markets have. He told Reuters elevated yields and headline inflation are “transient.” He also said “the strait will open” and energy prices should go back to normal once the Iran conflict is over. Reuters
Bund yields slipped along with U.S. bonds, with Germany’s 10-year yield down 3 basis points Wednesday to 3.16% after hitting a 15-year high. Earlier this week, Japan’s 30-year government bond yield reached a record 4.200% and the 10-year yield rose to its highest point since 1996.
Bond traders could be reading the wrong conflict. Oil gained more than 1% on Thursday on U.S.-Iran talks, with Brent at $106.29 and WTI at $99.55 a barrel. Reuters said U.S. crude and gasoline stockpiles dropped last week. If energy prices stay up, inflation might stick and yields rise again. But if a deal lets oil move through the Strait of Hormuz and crude prices drop sharply, the trade could flip fast.
