Yields elevated as inflation fears keep markets on edge

Longer-dated U.S. Treasury yields eased from earlier highs after 30-year yields touched a peak not seen in more than 20 years, but they remained elevated as markets grappled with renewed inflation concerns and expectations of additional central bank rate hikes. On Thursday, oil rose about 2% following U.S.-Iran diplomatic talks that signaled little progress. A sharp global bond selloff on Wednesday pushed 10-year yields to their largest daily jump since April 2025 tariff turmoil, helped by stronger-than-expected U.S. business activity data, including prices paid rising to a near four-year high. Equities dipped modestly: the Dow fell 0.37%, the S&P 500 0.23%, and the Nasdaq 0.51%. The 10-year yield slid to 5.112% after earlier reaching 5.1497% (highest since 2007). Fed funds futures priced 66% odds of a Fed hike next month. Investors awaited a $44 billion 7-year auction after weaker demand for Wednesday’s $70 billion 5-year sale.