Major Factors Behind Rising Long-Term U.S. Treasury Yields
When the yields (interest rates) of l ong-term U.S. treasury bonds such as the 10-Year Treasury go up, it means the U.S. government must pay more to borrow money for these bonds. This change reflects investor behavior and broader economic conditions. Here’s a comprehensive list of all major causes of rising 10-year Treasury yields: 📈 1. Inflation Expectations Increase If investors think future inflation will rise, they demand higher yields to compensate for the reduced purchasing power of their returns. This is one of the most common reasons yields rise. 🏦 2. Federal Reserve Policy (Tightening) When the Fed raises short-term interest rates , long-term yields often rise too — especially if the Fed signals inflation is a risk. The Fed also affects long-term rates by: Ending bond purchases (quantitative easing) Selling bonds (quantitative tightening) 📊 3. Strong Economic Growth A growing economy increases dem...