10-year Treasury yield trades near levels not seen since 2007, 30-year bond rate tops 5%

U.S. Treasury yields were little changed Wednesday, with the 10-year Treasury yield trading around levels last seen in 2007, as investors fretted over the potential for tighter Federal Reserve monetary policy for longer than expected.

At 7:44 a.m. ET, the yield on the 10-year Treasury was down more than two basis points 4.777%. Earlier in the day, it rose to a high of 4.884% after first crossing the 4.8% mark on Tuesday — reaching levels last seen in 2007.

The 30-year Treasury yield was last four basis points lower at 4.896%. It briefly traded above 5% earlier in the session, hovering at levels last seen in 2007.

The 2-year Treasury was last down by less than 2 basis points at 5.131%.

Yields and prices have an inverted relationship. One basis point equals 0.01%.

The latest jump in yields was fueled by Tuesday’s Job Openings and Labor Turnover Survey for August. The report showed 9.61 million job openings, higher than the 8.8 million economists surveyed by Dow Jones anticipated.

Investors took that as a sign of continued tightness in the labor market, which could prompt the Fed to raise interest rates further. The central bank began hiking rates in March 2022 in an effort to ease inflation and cool the economy, including the labor market.

In recent weeks, there have been mixed messages from Fed officials about whether interest rates will need to go higher still this year. However, they have widely suggested that rates will likely need to remain elevated for longer than previously expected, prompting renewed concerns about higher rates leading to a recession.

Further data that could inform the Fed’s monetary policy decisions is expected as the week continues. This includes ADP’s employment change figures and ISM’s purchasing managers’ index report for the service sector on Wednesday, as well as September’s nonfarm payrolls data on Friday.