U.S. Treasuries post worst quarter since 1994 as yields hit multi-decade highs
The 10-year Treasury yield's 87-basis-point jump in the September quarter was the sharpest since 1994, Reuters said, with the yield touching about 5.3% — levels not seen since the 2000s — as energy costs and strong growth keep pressure on bonds and stocks.
AI-assisted · US Brief desk · Sources listed below
What happened
The 10-year Treasury yield rose 87.1 basis points in the September quarter, the sharpest quarterly increase since 1994, according to LSEG data cited by Reuters. On Thursday the yield touched about 5.33%, the highest since April 2002, CNBC reported, before steadying near 5.28%, per Reuters. The 30-year yield topped about 5.65%, its highest since 2002.
Why it matters
Higher long rates raise mortgage, corporate, and Treasury interest costs and can undercut stocks even when growth looks solid. Friday's jobs report is the next major U.S. data checkpoint.
What’s next
Watch Friday's nonfarm payrolls, oil's path after Middle East shipping recoveries, and whether equity markets follow bonds lower.
More context
U.S. government bonds just finished their worst quarter this century by yield rise, and borrowing costs kept climbing into October as investors weighed energy-driven inflation against still-strong growth.
Stocks Wednesday: The S&P 500 fell 0.3% to 7,651.54, closing its third down month in four. The Dow dropped 0.9% to 50,906.05. The Nasdaq rose 0.2% to 26,861.06, AP reported. Soft August PCE inflation (3.4% year-over-year vs. 3.7% expected) briefly cut October Fed hike odds toward about 37% on CME FedWatch, but longer yields stayed elevated.
Why yields are rising: Reuters and AP point to high energy prices from the Iran conflict, AI and data-center investment lifting growth expectations, and heavy government borrowing. Shorter yields eased on the cooler inflation print; longer yields reflect sticky inflation and fiscal worries.
Global spillover: European shares fell Thursday as French and other euro-area yields jumped. Britain's 30-year gilt yield rose above 6%, Reuters reported. Traders have shifted from expecting U.S. cuts to pricing further Fed hikes into 2027 after last month's increase.
5 listed sources
- Reuters via Investing.com, Oct 1, 2026: Bonds teeter after US Treasuries' worst quarter since 1994
- Reuters, Oct 1, 2026: Bonds teeter after US Treasuries' worst quarter since 1994
- CNBC (Jenni Reid), Oct 1, 2026: 10-year Treasury yield hits highest level since 2002
- AP via WXXV (Stan Choe), Oct 1, 2026: Most US stocks fall after bond market pressure
- Sourcing note: Wire-service market report. Intraday yield highs differ slightly across Reuters updates; equity closes are Wednesday's AP figures.
References listed by US Brief; a source count is not a verification score.
Editorial sourcing notes
87.1 bp quarterly rise (LSEG), 10-year ~5.31% then ~5.28%, 30-year above 5.65%, global spillover follow Reuters via Investing.com, Oct 1, 2026. Later Investing rewrite cited 10-year at 5.34% highest since 2002 — note intraday variance. Wed equity closes and PCE/FedWatch odds follow AP (Stan Choe) via WXXV, Sep 30/Oct 1. Yield prints move; treat as session levels. Refresh 6:10 AM PT Oct 1: Thursday high updated to CNBC/LSEG 5.3338% (highest since April 2002), replacing the 'since 2007' reading; CNBC source added.
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