U.S. 30-Year Treasury Yield Climbs Above 5% Following Moody’s Downgrade and Fiscal Pressure
The yield on the 30-year U.S. Treasury bond surged past the 5% mark Monday, highlighting investor concerns amid Moody’s recent credit rating downgrade and increasing national debt challenges.
Reaching an intraday peak of 5.011%, the 30-year yield has not seen levels this high since April, when the so-called “tariff tantrum” roiled markets and triggered significant sell-offs across equities and cryptocurrencies.
Back then, Bitcoin (BTC) was trading near $75,000 but has since rebounded sharply, now hovering near $103,000, with a recent high just above $106,000.
Jim Bianco, founder of Bianco Research, remarked that the last time the 30-year Treasury yield closed at or above 5% was in late October 2023, with the highest close of 5.11% occurring earlier that month — the highest level since 2007.
The United Kingdom overtook China in March to become the second-largest foreign holder of U.S. Treasury securities, with $779.3 billion in holdings, trailing only Japan.
Both China and Japan have reduced their Treasury holdings over the past year, putting additional pressure on U.S. debt issuance and raising questions about demand sustainability.
With U.S. deficits rising and bond supply increasing, yields are being pushed higher as prices fall, while Nasdaq futures have retreated around 2% amid a broader risk-averse environment.
