The 30-year US Treasury bond yield rises above 5%, soaring oil prices stimulate market interest rate hike bets.

The US Treasury yields fell as the 30-year yield rose to its highest level since July. With oil prices surging, traders are increasing their bets on the Federal Reserve raising interest rates. On Monday, the yield curve rose at least 7 basis points, with the 30-year yield at 5.03%. The two-year yield, which is most sensitive to expectations of Federal Reserve policy, rose by 11 basis points to 3.99%. Interest rate swaps indicate that traders are expecting an 80% probability of a rate hike by the end of April 2027, a sharp contrast to expectations before the outbreak of the Iran war in late February, when the market expected a series of rate cuts.