Bond market turmoil intensifies as yields surge. The 30-year Treasury yield reached 5.19%, its highest level since June 2007, while mortgage rates climbed to 6.75%. Investors face significant losses as bond prices fall sharply. The market is gripped by three major concerns: accelerating inflation spreading across services and food, a Federal Reserve perceived as too lenient despite price pressures, and a mounting tsunami of government debt requiring massive new bond issuances. The 10-year Treasury yield jumped 70 basis points since February, reaching 4.67%. Recent Treasury auctions left buyers underwater almost immediately, with 30-year bonds sold at 5.046% now trading below par. The Fed's rate cuts have paradoxically pushed long-term yields higher, creating an unprecedented 156 basis point spread between 30-year Treasury yields and the federal funds rate.
