US 30-year Treasury yield hits 22-year high, 10-year 19-year high

Longer-dated yields rise after durable goods data Investors weigh expectations for further rate hikes Oil prices ease after recent gains (Updates to afternoon) By Caroline Valetkevitch NEW YORK, Sept 25 (Reuters) — US longer-dated Treasury yields rose on Friday, extending their recent sharp move higher after more upbeat economic data reinforced concerns about inflation. The 30-year US bond yield hit a fresh 22-year high and the benchmark 10-year yield reached a fresh 19-year high. Yields have jumped recently on persistent worries about higher inflation.

New orders for key US manufactured capital goods increased more than expected in August and the previous month's figures were revised sharply higher, signalling another quarter of robust growth in business spending on equipment amid an AI buildout. The Friday report followed an S&P Global survey earlier this week showing a pickup in business activity in September. The bullish data has driven up expectations for another interest-rate increase by the Federal Reserve. Traders now see a more than 64% chance of another hike when the US central bank next meets in October, according to CME Group's FedWatch Tool.

That expectation was around 55% a week ago. The Fed raised rates last week for the first time since 2023 in an effort to control inflation, which has steadily risen in part due to higher fuel prices tied to the US-Israeli war with Iran. Several Fed officials said this week that additional interest-rate hikes may be needed to curb the growth in prices. "The only thing that they can do is slow demand down," said John Luke Tyner, head of fixed income and portfolio manager at Aptus Capital Advisors.

He said, however, that there is a risk of the Fed raising rates too far. " Oil prices eased on Friday as investors weighed the possibility of a truce between the US and Iran, relieving some of the upward pressure on yields. A $70 billion auction of five-year notes this week that drew weak demand added to the recent selloff in bond prices, which move inversely to yields. Long-term yields also mostly continued to climb this week despite another Treasury buyback operation, an intervention the government said is aimed at addressing liquidity in the Treasury market.

Next week brings more key data for investors and the outlook for rates: the September US payrolls report and the monthly read of the personal consumption expenditures price index (PCE), which is closely followed by the Fed and could offer insight into inflation trends. 486%. 5319%, the highest since 2004. 165%.

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