Treasury Secretary Scott Bessent and Fed Chair Kevin Warsh are being called a double whammy to global markets as 30-year Treasury yields hold above 5% for 27 consecutive days, their longest stretch since 2007. Bessent authorized the first US-coordinated yen intervention in nearly 30 years, routing it through euros and signaling a preference for a weaker dollar, while Warsh’s sparse communication style leaves investors guessing on policy direction amid a 12-month high in core inflation and an unusually high number of Fed officials favoring an immediate rate hike. Japan, the largest foreign holder of US debt with over $1 trillion, risks forced liquidation that could spill into Treasuries just as Treasury raised its quarterly borrowing estimate to $739 billion. The Bloomberg Dollar Spot Index has fallen about 2% from its June peak even as yields climb, and the term premium on 30-year bonds jumped to 1.56%, the highest since 2013. Despite the bond market stress, equities remain resilient with the S&P 500 at a record high and the VIX at 16.50, while PIMCO notes that only about 2% of trading days this year have seen simultaneous selloffs in Treasuries, credit spreads, and the dollar.
SoFi Technologies Inc.Core inflation at 12-month high and Fed officials favoring rate hike push yields up
30-year yields hold above 5% for 27 days, term premium highest since 2013
