Yields on 10-year US government bonds surpass 3%

Thus, the yield bonds in the US has doubled since the end of last year until now. In the latest trading session, the yield on the 10-year US Treasury note rose to 3.0045% – the highest level since December 2018. For the whole month of April, the yield on 10-year US Treasuries increased by 25%.

The milestone described above occurs when investors expect that U.S. Federal Reserve (Fed) will raise interest rates sharply at its policy meeting ending on May 5.

Previously, in the minutes of the March policy meeting, the Fed said it expected to raise interest rates six more times to reach 1.9% by the end of this year.

Currently, many experts predict that, in 3 consecutive policy meetings in May, June, July, the FED – the agency that acts as the Central Bank of the US may have to raise 50 basis points each time to control the situation. Inflation is at a record high of more than 40 years. Therefore, US Treasury bond yields will continue to increase, in the same direction as the basic interest rate.

Ms. Kathy Jones – Charles Schwab multinational financial group said: “The option to increase 50 basis points is almost closed. I do not think a 75 basis point increase is feasible. The rapid increase of the This year’s bond yields are reducing the attractiveness of risky investments, thereby affecting the stock market on Wall Street in the near future.”

Currently, investors on Wall Street are keeping a close eye on the spread between the 2-year and 10-year US government bond yields. The hourly spread is around 0.2%, causing many to worry about the yield curve inverting and the economy at risk of falling into a recession.

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