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Amid rising concerns about a potential ?death spiral? in the U.S. Treasury market, major international investors remain unfazed. What Happened: European money managers, Australian pension funds, and Japanese insurers are still favoring U.S. Treasuries, attracted by their yield premiums compared to other markets.

The U.S. bond market is sending significant signals to Wall Street and Washington as Treasury yields approach levels not seen in nearly two decades, potentially complicating the incoming president-elect Donald Trump administration?s economic agenda. What Happened: The yield on the 10-year Treasury has surged more than 1% since September, nearing the psychologically important 5% threshold.

The allure of 5% yields is driving investor inflows into long-dated Treasury ETFs, even as persistent bond market losses and rising macro uncertainties complicate the interest-rate outlook. Last week, iShares 20+ Year Treasury Bond ETF saw a staggering $1.5 billion in inflows, as etfdb.com data shows.

Mortgage rates last week reached their highest levels since July 2024 with the average 30-year fixed mortgage rate staying above 7%, according to Bankrate. The Details: Mortgage rates have climbed higher following recent economic data which has dampened Wall Street's expectations for the Federal Reserve to cut rates in the near future and caused 10-year Treasury yields to surge.

As U.S. Treasury yields approach the psychological 5% mark which it last saw briefly in 2023 and during the global financial crisis in 2008, analysts seem less concerned, calling this yield convulsion an overreaction. What Happened: The U.S. 30-year Treasury yielded 4.95% by the end of the trading session on Friday, however, it touched a high of 5.005% intraday.