30-Year US Treasury Auction Yield Reaches 25-Year Peak, Raising Concerns Over High Borrowing Costs
The US government's auction of 30-year bonds saw a winning yield hit a 25-year high. This follows a historic sell-off in long-term Treasuries, fueling speculation that the US may shift more of its debt issuance toward shorter maturities. The $25 billion auction on Thursday produced a yield of 5.216%, the highest since 2001, even as a drop in oil prices lifted the secondary market for government bonds. The previous day's 10-year note auction also yielded the highest level for that maturity since 2007. This poses a challenging issue for President Donald Trump and Treasury Secretary Scott Bessent ahead of the November midterm elections. After years of high inflation and elevated government spending, rising financing costs are beginning to ripple through the broader economy.
Oil Prices Decline and Inflation Data Improves, Traders No Longer Fully Price in Fed Rate Hike
As falling oil prices bolster optimism about the inflation outlook, bond traders have stopped fully pricing in a rate hike from the Federal Reserve this year. Benchmark oil prices have been a key driver of Treasury yields since the US attacked Iran in late February, triggering supply shocks. On Thursday, oil dropped more than 3% as traders assessed conflicting signals from the conflict, further strengthening expectations that US inflation has peaked.
Advanced Micro Devices Plans to Issue Investment-Grade Bonds, Raising Up to $5 Billion
Advanced Micro Devices is planning to raise up to $5 billion through a potential record-setting investment-grade bond issuance, joining the wave of corporate debt offerings fueled by the artificial intelligence boom. According to sources, the final size of the offering is not yet set and may adjust based on market demand. The company plans to issue bonds in four tranches with maturities ranging from 3 to 10 years. The 10-year bond's initial price guidance is set at 115 basis points above US Treasury yields. The issuance comes as Advanced Micro Devices ramps up investment to meet surging demand for computing power driven by AI. Recent agreements with Anthropic PBC and Microsoft are expected to expand the use of its AI chips.
OpenAI's Revenue Chief Dennis Dresser to Depart, Second Executive Exit in Days
OpenAI announced Thursday that its Chief Revenue Officer, Dennis Dresser, is leaving the company less than a year after joining. The departure comes as OpenAI prepares for a widely anticipated initial public offering, drawing attention to the string of executive exits. According to the announcement, Dresser is leaving to "pursue other opportunities." OpenAI has hired Dali Rajic, former President and COO of cybersecurity firm Wiz, to fill the role.
Fed's Hammack Highlights Three Areas of Financial Stability Risk, Including Treasury Market Leverage
Cleveland Federal Reserve Bank President Beth Hammack said she is closely monitoring three areas that could impact US financial stability, including leverage in the Treasury market. Speaking at an event in Dayton, Ohio on Thursday, Hammack noted, "We have a significant amount of outstanding debt, and that debt is purchased with a lot of leverage." She added, "The buyers of this debt are essentially borrowing to buy it, which could create some instability in the financial system."
Vice President JD Vance: Low Oil Prices for Americans Are Top Priority in War with Iran
In an interview, US Vice President JD Vance stated that in the conflict with Iran, the primary goal is to keep oil and gasoline prices low for Americans. Vance said the US has "many tools" at its disposal to pressure Iran.
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