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4mo ago

U.S. House Passes Trump's Tax Bill, Triggering Market Turmoil

The $3.8 trillion legislation advances to the Senate as bond yields hit multiyear highs, stocks fall, and bitcoin reaches record levels.

U.S. dollar, Euro and Pound banknotes are seen in this illustration taken May 4, 2025.
Tariff and fiscal fears are dragging the stock market and pushing bond yields higher.
NEW YORK, NEW YORK - MAY 21: Traders work on the floor of the New York Stock Exchange (NYSE) on May 21, 2025 in New York City. The Dow dropped over 800 points as continued worries about tariffs and the state of the U.S. economy persist. (Photo by Spencer Platt/Getty Images)

Overview

  • The U.S. House of Representatives narrowly approved President Trump's tax-and-spending bill, which is projected to add $3.8 trillion to the national debt over the next decade.
  • Long-term Treasury yields surged, with the 30-year yield reaching 5.15%, its highest level since October 2023, reflecting investor concerns over fiscal sustainability.
  • Major U.S. stock indexes fell more than 1%, driven by rising borrowing costs and uncertainty about the country's fiscal trajectory.
  • The dollar weakened against major currencies, while global bond markets, including Germany and Japan, experienced rising yields as investors reassessed risk.
  • Bitcoin soared to an all-time high of over $111,000, as investors sought alternatives to traditional assets in the face of market volatility.