Bond yields soared Wednesday as markets saw a possibility that monetary policy might remain tight if Trump’s proposals drive a rebound in inflation.
Bond yields surged after Trump’s reelection, which could impact the rate borrowers get on loans.
The 10-year Treasury yield rose 18 basis points, and the 30-year bond yield saw its biggest jump since March 2020.
Trump’s policies could increase inflation, impacting the Federal Reserve’s interest rate strategy.
Bond yields are soaring after Donald Trump’s reelection, suggesting that US borrowers might not get the relief they’ve been hoping for as Trump’s policies have the potential to complicate the Federal Reserve’s interest rate plans.
The 10-year US Treasury yield surged 18 basis points on Wednesday morning to 4.477%, representing the highest level since July 1. It’s surged 76 basis points since the Fed launched its first interest rate cut of the cycle in mid-September.
Longer-term yields also spiked, with the 30-year US Treasury yield jumping as much as 24 basis points for its biggest move higher since March 2020.
Treasury yields influence the pricing of consumer and corporate debt, and the latest moves higher will put pressure on consumer borrowers who want to take out a mortgage to buy a house or an auto loan to buy a car.
