Overview
- The global bond sell‑off pushed U.S. 10‑year and 30‑year Treasury yields to levels not seen since the early 2000s, with long yields briefly touching multi‑decade highs on Oct. 1.
- Oil prices have stayed elevated because of the seven‑month U.S.–Iran conflict and stalled talks over the Strait of Hormuz, which has amplified inflation fears and helped keep yields high.
- A softer August PCE inflation reading of 3.4% reduced the odds of an immediate Fed hike but did not arrest the rise in long yields, leaving monetary policy direction uncertain ahead of U.S. jobs data.
- Equities are split as AI and chip names rally on strong orders and Micron’s upbeat guidance while rate‑sensitive sectors and emerging‑market stocks face pressure from higher U.S. yields.
- Higher borrowing costs are squeezing emerging markets: India has seen large foreign portfolio outflows and Pakistan has introduced a Strategic Action Plan to deepen its local currency bond market and cut external risks.