Treasury yields reach multi-decade highs on economic data

US Treasury yields reached multi-decade highs on Thursday, driven by economic data releases and rising oil prices that heightened inflation concerns. The 10-year Treasury note yield hit its highest level since April 2002, following the largest quarterly gain since 1994. Meanwhile, the 30-year Treasury yield reached levels not seen since late May 2002.

This surge in yields was fueled by the Institute for Supply Management's report indicating that US manufacturing activity remained largely unchanged in September, with input prices rising amid strong demand. Despite this, labor market data showed that new applications for unemployment benefits dropped last week, and layoffs fell in September, indicating continued stability in the labor market.

The mixed movements in 2-year Treasury notes and the impact of oil markets, which rose approximately 2% following China's decision to suspend oil product exports, added further pressure to Treasury prices, threatening fuel market shortages due to the US-Israeli conflict with Iran.

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