US 30-Year Treasury Yield Hits 5.44%, Highest Since 2004, as Global Bond Rout Deepens

A relentless global bond selloff pushed the 30-year US Treasury yield to 5.44% on Thursday, a level not seen since 2004, while the benchmark 10-year yield topped 5.15%, its highest since July 2007. The rout, described by analysts as a "perfect storm," has been fueled by a combination of strong economic data including hot PMI readings, persistent energy price pressures, and growing expectations that the Federal Reserve will raise rates further. Weekly initial jobless claims came in at 197,000, below the 200,000 estimate and down from the prior week, reinforcing the picture of a resilient labor market that gives the Fed room to tighten.

Bank of America raised its year-end forecast for the 10-year Treasury yield to 5.0% from 4.5%, and also lifted its 2-year yield target to 5.0%, citing fiscal concerns, geopolitical risks including Iran tensions, trade pressures, and uncertainty around AI. The bank simultaneously raised its second-half Brent crude forecast to $95 per barrel, underscoring the energy dimension of the inflation concern. Investors who long viewed 5% on the 10-year as a potential market-breaking threshold are now debating whether 6% is the next critical level.

The spillover into equities was immediate. US stock futures extended declines ahead of the open, the Nasdaq slid as Treasury yields surged, and Oracle led technology names lower. Gold fell below its 50-day and 100-day simple moving averages as strong US activity data and hawkish Fed signals hardened rate-hike expectations. Elevated yields are pressuring global indebted nations and raising the bar for equity earnings growth, with traders increasingly weighing how sustained high rates could compress stock valuations and reduce the relative appeal of equities. A $44 billion 7-year Treasury auction was scheduled for 1:00 PM ET, representing an immediate test of market demand.