Wall Street is focused on the term premium, the extra yield investors demand for holding 10-year Treasury bonds instead of rolling shorter-dated securities. The term premium has spiked to 12-year highs in recent weeks, driving a bond selloff that pushed Treasury yields to 24-year highs and signaling investor concerns about fiscal and geopolitical risks ahead.
US Treasury yields have surged sharply since February's Iran conflict, with 10-year yields reaching 5.23% and 30-year yields at 5.614%, levels unseen in over two decades. Technical indicators suggest further yield increases could trigger a self-reinforcing selling spiral, though some analysts expect buyers may eventually step in at these elevated levels. Rising volatility in rate options and pressure on credit spreads signal growing market stress and investor concerns about sustained higher yields.