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.
The term premium has surged to decade-high levels in recent weeks, driving increased selling of U.S. Treasuries and pushing yields to their highest point in 24 years. Analysts attribute the rise to persistent market trends, macroeconomic uncertainty, and increased bond supply.