The bond market continues to send a clear message: inflation remains a concern.
While the Federal Reserve held rates steady, the 30-year Treasury yield climbed to its highest level since 2007, reflecting growing concern that inflation may prove more persistent than expected. Markets are increasingly pricing in the possibility of future rate hikes rather than rate cuts.
Higher long-term yields affect everything from mortgage rates and corporate borrowing costs to equity valuations. Investors may finally be entering a period where the “higher-for-longer” interest rate environment becomes the base case rather than the exception.
