US 30-Year Treasury Yield Climbs to Its Highest in Two Decades

According to an ecoiran report published Saturday (August 22), the yield on US 30-year Treasury bonds has climbed above 5.32%, a level rarely seen in more than two decades. The rise comes even as some US economic data has softened and the odds of further policy rate hikes have fallen. The report points to two main drivers: first, a wider US budget deficit and heavier bond issuance, which is pushing investors to demand higher compensation for holding long-dated debt; the term premium on 10-year US Treasuries has risen to about 0.83%, near its highest in several years. Second, large technology companies have been issuing debt at scale to fund AI-related investment, even as corporate bond spreads remain low. Ecoiran notes that the rise in yields does not necessarily signal a jump in inflation expectations, and partly reflects higher real yields and a bigger risk premium.