U.S. Treasury yields hit their highest level in more than two decades on Thursday as a global bond sell-off deepened.
The 10-year Treasury yield breached a level last seen in April 2002, rising 4 basis points to 5.3338%, according to LSEG data. The figure is key to rates for mortgage borrowing, auto loans and credit card debt.
The yield on the 30-year Treasury bond jumped 3 basis points to 5.6702%, its highest level since July 2002. The 2-year yield was 2 basis points higher at 4.91%.
Yields and prices move inversely. One basis point equals 0.01%.
Loading chart...
Government borrowing costs rose around the world on Thursday, continuing a months-long trend as investors express concerns over a lack of political action to tackle fiscal deficits, while inflation remains sticky and interest rates rise.
Major economies face "persistently large deficits and rising interest expenses — challenges long associated with debt-distressed emerging market sovereigns," the Institute of International Finance said last week.
Japan's 10-year yield was last seen at 3.126%, the highest level in three decades. Japan's globally influential debt has come under pressure from a weaker yen and rate hikes by the Bank of Japan.
The yield on the German 10-year bund, the benchmark for the euro area, was up 4 basis points at 3.6179% — its highest since 2008. Elsewhere in Europe, the French 10-year popped 11 basis points to 4.9501%, Italy's 10-year was up 10 basis points to 4.7171%, while the U.K.'s 10-year yield was up 5 basis points to 5.483%.
Bonds are increasingly moving in lockstep with oil prices, which have been turbulent amid the U.S. and Israel's war with Iran obstructing crude exports from the Middle East. Crude oil prices were higher on Thursday, with international benchmark Brent Crude back above $100 a barrel.
"We could see [bond] buyers come in effectively to take advantage of those yields, which would have the effect of causing them to go down, but also one of the things that has kept the volatility in those yields in the long end of the curve has been what's going on with oil, what's going on with inflation," Nomi Prins, founder of Prinsights Global, told CNBC's "Squawk Box Europe" on Thursday.
But sovereign wealth funds and central banks, among the main long-term holders of Treasury debt, are unlikely to do this, Prins said.
"We could see movement ... in Treasury yields going down if oil prices go down significantly, if there's a resolution" in the Middle East, Prins added.