Long-term borrowing costs are rising, posing headwinds for businesses and financial markets globally.
The 10-year U.S. Treasury yield, a benchmark for “risk-free” borrowing, climbed to 4.27% — its highest level since September 3, according to TradingView. As a baseline for loans and financing worldwide, the yield influences everything from mortgages to corporate debt. Foreign holders, including China and Japan, own trillions in Treasuries, meaning higher yields push global borrowing costs upward.
Rising yields tighten financial conditions, potentially curbing investment, spending, and risk appetite. High-beta assets such as bitcoin, other cryptocurrencies, and equities are particularly sensitive. Bitcoin fell more than 1.5% to $91,000 in early Asian trading, while Nasdaq futures dropped over 1.6%.
Traders cited renewed geopolitical tensions, including President Donald Trump’s tariff threats against Europe over Greenland, as a catalyst. Trump warned of a 10% levy on imports from eight European nations starting Feb. 1, rising to 25% on June 1 unless a deal is reached. European leaders criticized the threats, with speculation over potential retaliatory U.S. asset sales, though most holdings are privately owned.
Yields are also climbing abroad. Japanese government bonds rose after Prime Minister Sanae Takaichi proposed food tax cuts. Across advanced economies, higher fiscal spending and expanded bond issuance are driving rates upward, signaling a broader tightening in global financial markets.
