Bill Dudley, Columnist

The Bond Market’s Faith in America Is Facing a Severe Test

Higher yields on longer-term US Treasuries reflect real problems: excessive supply and waning foreign demand.

May 30, 2025 at 10:30 AM UTC

Bill Dudley is a Bloomberg Opinion columnist. A former president of the Federal Reserve Bank of New York, he is a member of Coinbase Global's advisory council.

Not for the bond market.
Photographer: Kevin Dietsch/Getty Images

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The market for Treasury securities is sending an increasingly troubling signal. As of last week, investors were demanding about 90 extra basis points in yield to compensate for the added risk of lending longer-term to the US government. In October, before the election of President Donald Trump, the 10-year term premium was close to zero.

The message: America is becoming less attractive to global investors at a time when its government needs them more than ever.