LONDON — US long-dated bond yields nudged up to new multi-month highs on Thursday, before stabilizing, a day after soft demand for a sale of 20-year bonds underscored market worries about the United States’ increasing debt burden.
Investors are also watching a sweeping tax and spending bill that is expected to worsen the fiscal outlook. The bill cleared a crucial hurdle on Thursday, and will be voted on later in the day by the House of Representatives.
The US 10 year Treasury yield rose as high as 4.613 percent on Thursday, its highest since mid-February. In early London trade, it was last steadier at around 4.58 percent.
Super long-dated bonds are under even more pressure and the US 30-year yield reached 5.108 percent, its highest since October 2023, and the 20-year yield hit 5.126 percent, its highest since November 2023.
“With the US tax bill making its way through the House, scrutiny of the country’s fiscal trajectory will remain a headwind for long end rates,” said Benjamin Schroeder, senior rates strategist at ING in a note to clients.
He said weaker auction results would only provide occasions to push rates higher.
The US is at the centre of a sell off in global government bonds, but is not alone, longer dated yields are also rising in Japan, the euro zone, and Britain.
