Rising yields near multi-decade highs threaten to escalate borrowing costs for $39.065 trillion in federal debt due for refinancing.
The 10-year Treasury yield climbed to 4.705%, its highest level since January 15, 2025, driven by Brent crude above $100 and jobless claims at 187,000. Half of Federal Reserve officials now expect a rate hike this year, intensifying refinancing pressures.
Federal debt reached $39.065 trillion as of January 1, 2026, with much of it issued when yields were below 2%. The 30-year yield sits at 5.182%, while the 2-year is at 4.343%, signaling higher costs for new issuance.
Corporate profit growth slowed to 1.7% quarter-over-quarter as borrowing costs rise for mortgages, auto loans, and corporate debt. The Treasury faces a refinancing challenge amid tightening financial conditions.