Traders work on the floor of the New York Stock Exchange (NYSE) on August 5, 2026 in New York City, USA.
Gina Moon | Reuters
U.S. Treasury yields rose on Tuesday as tensions between the U.S. and Iran continued, pushing long-term yields to their highest level in more than 20 years.
U.S. stock yields rose early Tuesday morning. 30 year treasury The yield is trading at around 5.322%, up more than 1 basis point, and remains just below its highest level since 2002.
The yield on the 10-year Treasury note, a key measure of mortgage, auto loan and credit card debt, rose more than 1 basis point to 4.736%.
The yield on two-year Treasuries, which typically reacts to the Federal Reserve’s short-term interest rate decisions, was flat at 4.186%.
Long-term government bond yields remain at the highest level in decades.
One basis point equals 0.01%, and yield and price are inversely proportional to each other.
A 60-day deadline for the United States and Iran to reach a peace deal expired on Monday, with oil prices rising as Iran ruled out an extension, state media said. A senior Iranian official also told Reuters that if diplomacy with the United States fails, Iran will take an aggressive stance.
“Market weakness has increased over the past 24 hours, with bonds and stocks falling thanks to negative geopolitical headlines from the Middle East,” Deutsche Bank’s Jim Rid said in a note on Tuesday. “While there was no trigger for the decline, there was little sign that the US and Iran would reach any kind of agreement, which meant investors were pricing in a prolonged closure of the Strait of Hormuz.”
Resurgent concerns about inflation are raising borrowing costs for governments around the world, with yields on many long-term bonds hovering near multi-decade highs.
Japan’s long-term government bond yields are hovering around the levels seen in May, when yields hit their highest level in 40 years. Germany’s 30-year bond yield is at its highest level since 2011, while Britain’s 30-year bond yield is nearing its highest level in decades. France’s 30-year government bond yield also rose to its highest level since 2008.
In terms of economic indicators, investors will focus on July’s import and export price figures, along with housing starts and pending home sales on Tuesday.
—CNBC’s Chloe Taylor also contributed to this report.
