Yields hit home
Sep 25, 2026 · 8 min · 6 segments
The global bond selloff pushes US 30-year yields to their highest in more than two decades, driving mortgage rates about 7% and squeezing borrowers. Reports of a phased US-Iran deal offer some hope…
Sep 25, 2026 · 8 min · 6 segments
The global bond selloff pushes US 30-year yields to their highest in more than two decades, driving mortgage rates about 7% and squeezing borrowers. Reports of a phased US-Iran deal offer some hope…
The U.S. 30-year yield has reached its highest since 2004, and the 10-year push is ever higher.
It's gone through 5% and out above 5.2. Now, the stock market seems fairly relaxed about this so far, but with Treasury yields at this level, ultimately assets have to reprice across the market to take that into account, don't they?
All yields for, you know, bonds everywhere are moving to multi-decade, in some cases even record highs.
As you say, the Treasury, Treasury note is the linchpin for the broader financial market, so the longer the yield remains above 5%, the more everything else has to start earning its keep, if you will, and repricing to remain competitive.
The Nasdaq nonetheless closed higher on Thursday, but this does put AI CapEx, that huge amount of spending that we've seen, further under pressure, doesn't it, especially because the hyperscalers have issued so much bond issuance of their own to fund it, which is now coming into competition with Treasury yields, isn't it?
I mean, if you take a look at hyperscaler debt, whether that's five-year bonds or 10-year bonds, of course those have moved up as well, but they're not trading, at least in the case of like the, the, um, higher rated issuers, so the Apples, the Amazons, the Microsofts, they're not trading wildly out of whack with Treasuries.
I mean, they're going, always going to trade at a little bit of a premium and that's sort of held relatively stable.
But as the 10-year push is ever closer towards five and a half, as you said, maybe even 6%, at what point do you think this is going to put equity markets under pressure?
I think one thing that's come out of discussions that we've had with fund managers over the last week or so is that, you know, there isn't really an absolute number.
They, they, they attack, grab attention, but this is really more about where is the Treasury yield relative to other things, or where are other things relative to it? Where is the equity risk premium, for example, that measure that tells us how much worth it is your while holding bonds versus stocks, for example.
Um, you know, with stock markets at record highs, uh, that doesn't seem to be coming into question, and I think the key thing also here is, um, resilient economic growth in the United States.
You know, with the U.S. economy still seemingly going gangbusters, with hyperscaler CapEx spending keeping those hopes going for, uh, continued expansion, construction jobs, um, promised efficiencies and productivity gains in the future, that's kind of s- that's kind of good enough for now, and as long as these things remain more or less in place, you know, the U.S. economy can withstand yields at this level.
I mean, whether a mortgage owner will be able to withstand it, or someone filling up their car at the petrol station, for example.
That might take a bit longer to filter into things like consumer spending, but for now, it seems to be, things seem to be holding up.
The U.S. 30-year yield has reached its highest since 2004, and the 10-year push is ever higher.
It's gone through 5% and out above 5.2. Now, the stock market seems fairly relaxed about this so far, but with Treasury yields at this level, ultimately assets have to reprice across the market to take that into account, don't they?
All yields for, you know, bonds everywhere are moving to multi-decade, in some cases even record highs.
As you say, the Treasury, Treasury note is the linchpin for the broader financial market, so the longer the yield remains above 5%, the more everything else has to start earning its keep, if you will, and repricing to remain competitive.
The Nasdaq nonetheless closed higher on Thursday, but this does put AI CapEx, that huge amount of spending that we've seen, further under pressure, doesn't it, especially because the hyperscalers have issued so much bond issuance of their own to fund it, which is now coming into competition with Treasury yields, isn't it?
I mean, if you take a look at hyperscaler debt, whether that's five-year bonds or 10-year bonds, of course those have moved up as well, but they're not trading, at least in the case of like the, the, um, higher rated issuers, so the Apples, the Amazons, the Microsofts, they're not trading wildly out of whack with Treasuries.
I mean, they're going, always going to trade at a little bit of a premium and that's sort of held relatively stable.
But as the 10-year push is ever closer towards five and a half, as you said, maybe even 6%, at what point do you think this is going to put equity markets under pressure?
I think one thing that's come out of discussions that we've had with fund managers over the last week or so is that, you know, there isn't really an absolute number.
They, they, they attack, grab attention, but this is really more about where is the Treasury yield relative to other things, or where are other things relative to it? Where is the equity risk premium, for example, that measure that tells us how much worth it is your while holding bonds versus stocks, for example.
Um, you know, with stock markets at record highs, uh, that doesn't seem to be coming into question, and I think the key thing also here is, um, resilient economic growth in the United States.
You know, with the U.S. economy still seemingly going gangbusters, with hyperscaler CapEx spending keeping those hopes going for, uh, continued expansion, construction jobs, um, promised efficiencies and productivity gains in the future, that's kind of s- that's kind of good enough for now, and as long as these things remain more or less in place, you know, the U.S. economy can withstand yields at this level.
I mean, whether a mortgage owner will be able to withstand it, or someone filling up their car at the petrol station, for example.
That might take a bit longer to filter into things like consumer spending, but for now, it seems to be, things seem to be holding up.
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