Arabic version: عائد سندات الخزانة لأجل 10 سنوات يصل إلى 5% قبل قرار الاحتياطي الفيدرالي

According to Cnbc, the 10-year U.S. Treasury note yield rose more than 2 basis points to 5% on Monday, its highest level since October 2023. The move came ahead of the Federal Reserve’s policy meeting on Tuesday and Wednesday. The benchmark yield influences mortgages, auto loans and credit card debt.

The 2-year Treasury yield, which is particularly sensitive to short-term Fed policy, advanced more than 2 basis points to 4.666%. It had touched its highest level since July 2024 last week. The 30-year Treasury bond yield also gained 2 basis points, reaching 5.374%. One basis point equals 0.01%, and bond yields move in the opposite direction to prices.

August consumer price index data released Friday matched expectations, but inflation remained far above the Fed’s 2% goal, according to the report. The reading was the last inflation indicator before the central bank’s meeting. CME Group’s FedWatch tool put the odds of a quarter-point rate increase at 90%.

Jay Woods, chief market strategist at Freedom Capital Markets, said a rate increase would be the “cleaner decision” based on the data and market expectations. He said the market may rally if the Fed raises rates, while no change could prompt a negative reaction because it could signal that the Fed is behind the curve.

The 5% threshold is viewed as psychologically important. A move above 5.02% would put the 10-year yield at its highest level since July 2007. Jason Ware, chief investment officer at Albion Financial Group, attributed part of the rise to competition for investor capital from large Treasury and corporate debt issuance, while saying he does not expect markets to break simply because the yield exceeds 5%.