10-year Treasury yield rises to highest since January 2025 as surging oil rekindles inflation fear

U.S. Treasury yields advanced on Thursday as Brent crude oil’s climb above $100 per barrel raised inflation fears, and as weekly claims for unemployment insurance tumbled below 200,000.

The yield on the 10-year U.S. Treasury note — the key benchmark for mortgage and auto loans and credit card debt — was last up 5 basis points at 4.707%, the highest since Jan. 15, 2025, before the start of President Donald Trump’s second term.

The 2-year Treasury note yield, which more closely tracks short-term Federal Reserve interest rate policy, rose 6 basis points to 4.362%. The longer-dated 30-year Treasury bond yield was higher by more than 3 basis points, reaching 5.183%.

One basis point equals 0.01%, and yields and prices move inversely to one another.

Oil prices continued to climb on Thursday, with Brent crude futures on pace for their third-largest monthly gain in the past 10 years, following reports of Houthi rebel attacks on tankers off the Red Sea coast of Saudi Arabia, and renewed U.S. threats to escalate strikes against Iran.

Brent crude futures for July delivery gained 6% to trade above $100 a barrel, the highest since before the U.S. and Iran reached a tentative peace deal last month. U.S. West Texas Intermediate crude futures advanced 5% to more than $91 a barrel.

Meanwhile, jobless claims for the week ended July 18 came in at 187,000, below the 212,000 that economists polled by Dow Jones were expecting. Investors will next look ahead to the latest S&P Global Flash U.S. purchasing managers index report due Friday, which measures the economic health of American manufacturing and services sectors.