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Yields surge to May 2025 highs as oil prices?and inflation data rattle markets

BY Reuters | TREASURY | 08:47 AM EDT

By Karen Brettell

NEW YORK, May 15 (Reuters) - Longer-dated Treasury yields climbed to their highest levels since May 2025 on Friday, as a spike in oil prices stoked fears that ongoing energy disruptions in the Middle East could further fuel inflation - which data this week showed had already surged in April.

Oil prices gained 3% after U.S. President Donald Trump said his patience with Iran is running out, adding to concerns over the lack of progress on a peace deal to end ship attacks and seizures around the Strait of Hormuz.

Investors have already been rattled by strong inflation prints this week showing energy disruptions are being seen in some inflation-based measures. U.S. consumer inflation saw the largest annual gain in three years last month, while U.S. producer prices posted their biggest increase in four years.?

The 2-year note yield, which typically moves in step with interest rate expectations for the Federal Reserve, was up 7 basis points at 4.062%. It?reached 4.071%, the highest since March 2025.?

The yield on benchmark U.S. 10-year notes rose 9.3 basis points to 4.552%. It got to 4.558%, the highest since May 2025.

The 30-year bond yield rose 8.6 basis points to 5.0992%. It reached 5.103%, also the highest since May 2025.

(1Reporting by Karen Brettell; Editing by Hugh Lawson)

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In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.

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