US 10-Year Yields Climb to Highest Since 2025 as Rout Deepens

On Tuesday, August 18, 2026, a deepening global bond selloff pushed US Treasury yields higher across maturities, with the 10-year rate climbing around two basis points to 4.75%, its highest in 19 months, according to The Edge Malaysia. The move was echoed from Europe to Japan, where Germany sold 30-year debt at the highest yield in 15 years. Thin August trading, investor wariness over inflation, and a record corporate issuance slate contributed, The Edge reported. Other outlets described far more dramatic levels: InvestingLive said the 30-year neared 5.5%, highest since 2004, and the 10-year around 5.2%; PressInsider cited a 30-year near 5.27% and a 10-year at 4.79%. The sources disagree on the exact figures and dates.

Background

The sources describe a months-long global bond slide driven by converging forces. The Edge Malaysia cites an uncertain inflation outlook and changing bond-buyer demographics, plus Middle East peace prospects suffering setbacks after US President Donald Trump said he was not interested in extending the expiring agreement with Iran and tensions flared in the Strait of Hormuz. InvestingLive points to energy costs, resilient growth, Fed hike bets and heavy government borrowing, noting the 10-year was up roughly 70 basis points since the Fed's June meeting and about 125 basis points since early March, with most of the rise attributed to expectations of further Fed tightening. PressInsider cites persistent inflation, large federal deficits, weakening demand from traditional buyers and competition from corporate borrowers financing AI infrastructure, with the US deficit at $1.8 trillion over the first 10 months of fiscal 2026 and the CBO projecting $2.1 trillion for the full year. It also notes foreign governments and central banks now hold 13% of publicly traded US Treasuries, down from 15% three years ago, per TD Economics' Vikram Rai, as cited by MPAMag. Germany expects record federal borrowing of around €525 billion this year, and Japan's 10-year yield hit its highest since 1996.

What happened

The Edge Malaysia reported on August 18 that US Treasuries slid further on Tuesday, pushing yields up one to two basis points across maturities, with the 10-year creeping up around two basis points to 4.75%, the highest in 19 months. Germany sold 30-year debt via banks paying the highest yield in 15 years. BMO's Ian Lyngen wrote that the selloff had become a macro event unto itself. August corporate issuance hit an all-time high for the month on Monday, topping US$145 billion, as 12 issuers sold US$9.1 billion of notes. Brent crude climbed above US$91 a barrel. Swaps traders priced a roughly 35% chance the Fed, led by chairman Kevin Warsh, lifts rates in September, with October a coin toss and a hike not fully priced until January 2027. InvestingLive reported the 30-year near 5.5%, highest since 2004, and the 10-year around 5.2%, highest since 2007, with mortgage rates at 7%. PressInsider reported the 30-year toward 5.27% on Tuesday, 1 September, after reaching 5.34% in mid-August, and the 10-year at 4.79%, highest since January 2025. Yahoo Finance reported the 30-year surpassed 5.61% on Tuesday, September 29, a level last seen in 2002. MPAMag reported Canada's 10-year at 3.904% on September 10.

Market impact

The sources offer a range of figures. The Edge Malaysia put the 10-year at 4.75%, up about two basis points, with August corporate issuance topping US$145 billion and Brent above US$91 a barrel. InvestingLive put the 30-year near 5.5%, highest since 2004, the 10-year around 5.2%, highest since 2007, mortgage rates around 7%, Germany's 10-year Bund briefly above 3.6% (a 17-year high), and Japan's 10-year at its highest since 1996. PressInsider cited the 30-year toward 5.27%, the 10-year at 4.79%, Japan's 10-year reaching 3% for the first time since 1996, the UK 30-year at its highest since 1998, 30-year yields closing above 5% on 55 trading days this year, and about $31.5 trillion of Treasury securities outstanding at end-July, 8.6% more than a year earlier. Yahoo Finance cited the 30-year above 5.61%, the two-year settling around 4.89%, and a US$32 trillion Treasuries market. MPAMag cited Canada's 10-year at 3.904%, up 5.6 basis points, Brent above $100 a barrel, and the best available five-year fixed Canadian mortgage rate near 4.04%.

Why it matters

The sources frame the selloff as a macro event with broad consequences. The Edge Malaysia notes the moves were echoed across sovereign debt markets, fuelled by inflation uncertainty and changing bond-buyer demographics. InvestingLive says long-dated yields are testing how much the equity market can take, pressing on valuations behind the AI rally just as the Nasdaq sits near records, and that Treasury buybacks and yen intervention have failed to cap yields, suggesting policy tools have limited reach. It adds that higher Japanese yields could draw Japanese money out of foreign bonds, including Treasuries, and that 6% on the 10-year is emerging as the next pain threshold. PressInsider notes that large deficits push long-term yields higher as investors demand greater compensation, and that AI-related corporate borrowing competes with Treasuries. MPAMag reports that Canadian lenders have already been repricing fixed-rate products upward, with the bond market offering little near-term relief and a persistently higher borrowing-cost environment likely into 2027.