Bond Rout Reignites, Unleashing Worst Day Since 2020 Turmoil
- Market-implied odds of another Fed hike rebound to 40%
- Thirty-year yields rise as much as 19 basis points on day
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The US government bond market had its worst day since March 2020 by one measure, as hotter-than-expected September inflation data and weak demand for a bond auction fueled a surge in 30-year yields.
The 30-year Treasury yield rose as much as 19 basis points and was 16 basis points higher on the day in late trading, its biggest increase since the market turmoil unleashed by the onset of the pandemic. While at 4.86% it’s still nearly 20 basis points below multiyear highs reached last week, the surge stoked fears of new milestones, including a yield of 5% for 10-year yields.