The warning signs are not coming from a government default or a failed bond auction. They are coming from the price of borrowing itself. US Treasury yields have risen despite a recent run of weaker-than-expected economic data. For Robin Brooks, a senior fellow at the Brookings Institution, that is a troubling sign.
In a Substack post on Tuesday, Brooks argued that the market may be under greater pressure than it appears. He said policymakers are now focused on preventing long-term borrowing costs from rising further. As he put it, it is an all-hands-on-deck situation where long-term yields are concerned.
