Fed’s Barkin Says Term Premium Moving Long Rates, Not Inflation

The recent rise in long-term interest rates reflects higher risk premiums as opposed to concerns about inflation, Federal Reserve Bank of Richmond President Thomas Barkin said.

“There is no question in my mind that as a lot more federal debt comes onto the market, that it is at times overwhelming the demand, and that is what creates the increase in yields,” Barkin said Thursday during a virtual event hosted by the Virginia Bankers Association.