The 10-year Treasury yield climbed higher Friday, adding to its steep weekly rise, as dizzying trade moves by President Donald Trump caused investors to dump U.S. assets in favor of other global safe havens.
The benchmark 10-year Treasury yield advanced more 10 basis points to 4.495%. It earlier jumped to its highest level since Feb. 13. The 2-year Treasury yield climbed nearly 11 basis points on the day at 3.952%.
One basis point is equal to 0.01% and yields move inversely to prices.
The 10-year yield this week has risen more than 50 basis points this week after ending last week around 4%, marking one of the biggest spikes on record.
The move marks a stark reversal in how investors view Treasurys. Traditionally, investors have turned to U.S. debt as a safe haven during tumultuous times. That doesn’t appear to be the case this week as China and Japan appeared to be selling Treasurys amid the heightened trade tensions, traders speculated.
US 10-year Treasury yield 5-day chart
The move higher may have complicated the White House’s approach to trade.
Trump announced a 90-day tariff pause on most countries on Wednesday and reduced duties to a universal rate of 10%. The reprieve excluded China, which saw U.S. tariffs on Chinese imports rise to 145%. China struck back against the U.S. on Friday, raising its duties on American goods from 84% to 125%. While some administrations officials have said this reversal was always the plan, the dramatic spike in yields likely pressured them to pause.
“Scott Bessent is keeping a close eye on the bond market. He spoke to the White House and I know he is keeping his eyes on it,” the White House said on Friday.
Kevin Hassett, director of Trump’s National Economic Council also told CNBC on Thursday “the fact that the bond market was telling us, ‘Hey, it’s probably time to move,’ certainly would have contributed at least a little bit to that thinking.”
“But it wasn’t the bond market that made a panic move, because there was a very systematic, well-planned move that was just about to happen that just turned out to be the same time,” Hassett added.
Seema Shah, chief global strategist at Principal Asset Management, added that the bond market “likely struck a nerve with the Trump administration.”
“They have repeatedly emphasized their focus on bond yields and even celebrated last week when Treasury bond yields dipped below 4%. Low financing costs appear to be a key pillar of the Trump administration’s overall agenda, so the reversal in market trends, surging Treasury yields, undoubtedly caused significant concern in the White House,” Shah said.
Despite the pause, however, rates resumed their upward climb to the high levels that previously sparked concerned for the White House.