LONDON – The U.S. 10-year Treasury yield briefly reached 5 percent for the first time since 2007, marking a fresh milestone in a relentless push higher for government borrowing costs.
Further signs of resilience in the U.S. economy help explain the latest sell off in Treasuries, as traders have unwound bets the U.S. Federal Reserve would soon start to lower interest rates.
Earlier on Thursday, Fed Chair Jerome Powell said the economy‘s strength and continued tight labor markets could require still tougher borrowing conditions to control inflation, although rising market interest rates could make action by the central bank itself less necessary.
Treasuries have also been hurt by expectations for higher government debt levels and increased bond sales.