US Treasury sets 5% coupon on 10-year notes, highest since 2006

The U.S. Treasury set a 5% coupon on its 10-year notes, the highest since 2006, marking a significant milestone in the government bond market. The elevated yield reflects persistent inflation pressures and expectations that the Federal Reserve will maintain higher interest rates for longer. Higher 10-year rates could raise borrowing costs across the economy, potentially weighing on economic growth and tightening financial conditions. The development matters for crypto and risk assets because rising Treasury yields increase the opportunity cost of holding non-yielding assets like bitcoin. Market participants will watch upcoming inflation data and Fed commentary for signals on whether yields continue climbing.