U.S. Treasury to Issue 30-Year Bonds at Highest Yield Since 2001

The U.S. Treasury is set to sell $25 billion of 30-year bonds at a projected yield of roughly 5.23%, marking the highest cost of borrowing for that term since 2001. This follows a pronounced market sell-off that has sparked speculation about a shift toward shorter-dated debt. Treasury officials, including President Donald Trump and Secretary Scott Bessent, are under pressure as elevated financing costs feed into broader economic conditions ahead of the November midterms.

Recent guidance tweaks suggest the Treasury may consider reducing long-bond issuance, though investors remain cautious and are not rushing to buy at multi-decade highs. Analysts point to a large existing stock of 30-year paper and new sellers as key drivers of the price movement, rather than just fresh supply. Meanwhile, yields across maturities slipped slightly after producer-price data hinted at easing inflation, and expectations for a September Fed rate hike fell. The higher interest expense on the public debt has already pushed the fiscal year-to-date deficit to $1.17 trillion, a 15% rise.