U.S. Treasury yields extended their advance, with the 10-year note hitting 5.165% and the 30-year note rising to 5.455%, levels not seen since 2007 and 2004 respectively, according to Tradeweb data. The move reflected a broad selloff in government bonds amid fresh economic data that reinforced expectations for further tightening by the Federal Reserve.
Commodities added to inflation worries, as Brent crude prices gained more than 4% to $107.87 a barrel and U.S. natural gas futures rose over 6%. Investors also looked ahead to a $44 billion auction of seven-year notes and a $6 billion buyback of 20- and 30-year bonds scheduled for Thursday.
Economic indicators showed resilience: manufacturing activity in the central United States accelerated in September, jobless claims continued to decline, and new home sales rose above analyst forecasts though remained below the pace recorded in August of the previous year due to elevated mortgage rates.
Federal Reserve officials signaled openness to additional rate hikes. Philadelphia Fed President Anna Paulson said more tightening could be warranted if inflation shows little progress, while New York Fed President John Williams remarked that another increase by year-end is reasonable.
Internationally, the 10-year German Bund yield rose to 3.612%, its highest since 2009, and the WSJ dollar index climbed to 96.98, the strongest level since late July. The United Kingdom’s 10-year gilt yield hovered around 5.385%. Wednesday’s trading had already pushed yields up 10 to 15 basis points, and analysts noted that position unwinds and stop‑loss selling contributed to the move, with some warning that further weakness in long‑dated bonds could persist.
