US Treasury yields rise as global equity rebound dampens safe-haven demand

Global equity markets rallied enough on Friday to pull investors out of US Treasuries, pushing the 10-year yield to 5.10% and the 30-year to 5.44%, while European bonds outperformed. Federal Reserve Chair Kevin Warsh, addressing the IMF gathering in Bangkok, avoided any discussion of policy, reinforcing expectations that the Fed will hold rates steady at its upcoming meeting. The lack of fresh direction left Treasury prices vulnerable to shifts in risk appetite, which improved modestly after a prior day of AI-related stock sell-off.

Fixed-income strategists cited higher growth, inflation and fiscal worries as drivers of the long-end decline. Market pricing still anticipates three additional quarter-point hikes over the next year, though the probability of an immediate hike fell to about 20%. Analysts warned that elevated energy costs could sustain inflation pressures, limiting both bond rebounds and equity gains.