The US bond market is facing a critical test as the selloff that began with the war with Iran pushes the 10-year Treasury yield closer to the 5% mark, a level it has not sustained for an extended period in nearly two decades. The move is raising questions about how much higher yields could affect stocks, corporate borrowing, dealmaking and the broader economy.
According to Reuters, the impact of a 5% 10-year yield is not necessarily straightforward. Higher borrowing costs can weigh on consumers and businesses, but rising yields can also reflect strong economic growth and robust demand for capital.
