10-year Treasury yield continues to creep higher, now at 4.54%

Data released on February 11 showed that the 10-year U.S. Treasury yield is currently at 4.54%. The 10-year Treasury rate continued to rise compared to 4.51% the previous market day and 4.17% last year.

10-year Treasury yields rose following President Trump’s announcement of 25% tariffs on all foreign steel and aluminum entering the country. Ursula von der Leyen, European Union chief, said on Tuesday that unjustified tariffs on the EU will not go unanswered and will trigger firm and proportionate countermeasures.

10-year U.S. Treasury yield rises to 4.54%

10-Year Treasury Yield continues to creep higher, now at 4.54% 🚨 pic.twitter.com/JqvUIpg5g8

— Barchart (@Barchart) February 12, 2025

Menthor Q mentioned that strong economic data and inflation concerns pushed the 10Y Treasury yields to 4.50%-4.67% and the 2Y to 4.20%-4.29%. The data provider platform also argued that all eyes were on the upcoming inflation data and Powell’s testimony today as fewer Fed cuts are expected and debt worries continue to grow.

Robert Conzo, CEO and managing director at The Wealth Alliance said yesterday that historical evidence proved that the 10-Year Treasury yield will center around 4.5% in the future. He added that the history of the past 60 years showed that a 10-Year Treasury Yield of 4.5% was on the low side. Conzo argued that the perception of what a normal yield should be was skewed due to the historically low-rate environment after the Great Financial Crisis of 2008.

Conzo also added that yields should drop and bonds should become more valuable after the Fed first cut rates. He explained that the 10-year Treasury yield rose from 3.6% to 4.8% by mid-January after the Fed first cut interest rates in September. The financial advisor explained that the rise in long-dated yields was a reminder to investors that the Fed policy only impacted short-dated Treasuries. Fed President Jerome Powell also said that the central bank was in no hurry to adjust policy as the U.S. economy remained strong overall.

Donald Trump acknowledged on Sunday that the government’s efficiency team found irregularities that could mean the U.S.’s debt obligations were lower than thought. Pepperstone’s Micheal Brown said that Trump’s talk could give participants little to no choice but to attach a higher risk premium to the U.S. debt. Brown also believes that the market currently remains focused on tariffs as the U.S. Treasuries took Trump’s comments in stride.

Scott Bessent plans to maintain the 10-year Treasury yield below 5%

Treasury Secretary Scott Bessent highlighted that the Fed’s previous rate cut caused the 10-year yield to rise. He also said that the market response did not cause immediate concern at the central bank by raising questions about how effectively monetary policy was influencing the broader economy.

“The president wants lower interest rates and … in my talks with him, he and I are focused on the 10-year Treasury. He is not calling on the Fed to lower rates. He believes that if we deregulate the economy, if we can get this tax bill done, if we get energy down, then rates will take care of themselves, and the dollar will take care of itself.”

~ Scott Bessent, Treasury Secretary.

Bessent said on Wednesday that when Trump speaks of wanting lower interest rates, he is referring to the yield on the 10-year Treasury and not the short-term rate set by the Fed. Krishna Guha, vice chairman of Evercore ISI, maintained that expected deregulation, along with Bessent’s emerging plans for Treasury debt management, may have driven the recent shift in yields.

Guha believes the focus on the 10-year note eased tension between the Fed and the new administration. He also argued that it will be critical to maintain due to the implications of higher bond yields to Trump’s economic plans. Evercore ISI’s vice chair added that Bessent had on job to try to prevent the 10-year yield from breaking 5%.

The President also signed an executive order on Saturday imposing a 10% duty on China and 25% on imports from Mexico and Canada. Mexico President Claudia Sheinbaum said on Monday morning that Trump’s tariffs against the country would be paused for a month as it sends 10,000 soldiers to its northern border to stop drug trafficking. Canada has also threatened tariffs on the U.S., and the Chinese government is filing a lawsuit with the World Trade Organization.

Cryptopolitan Academy: How to Write a Web3 Resume That Lands Interviews - FREE Cheat Sheet