Benchmark US government bond yield hits 19-year peak as oil prices surge

The 10-year US Treasury yield hit 5.02 percent on Tuesday for the first time since the 2007 global financial crisis.The benchmark United States government bond rate has climbed to its highest level in 19 years as traders bet on a Federal Reserve interest rate hike following a new rise in oil prices.On Tuesday, the 10-year US Treasury yield hit 5.02 percent, a level unseen since the 2007 global financial crisis.Recommended Stories list of 3 itemslist 1 of 3US blocks Iran nuclear chief from attending key Vienna conferencelist 2 of 3What could stop the Houthis’ advance across Yemen?list 3 of 3Saudi Arabia promises to respond to Houthi attacks ‘firmly’end of listThe 10-year Treasury benchmark price influences the lending rate for nearly every asset in US financial markets, including consumer debt and home mortgages.Other global benchmark bonds have also reached multi-decade highs after the US and Iran escalated attacks in their more than six-month war last month, driving oil prices beyond $100 a barrel for the first time since May.Germany’s 10-year bond yield, a benchmark for the European economy, peaked at 3.554 percent on Monday, its highest since mid-2009, and stood at 3.547 percent on Tuesday.Japan’s 10-year government bond yield has breached 3 percent for the second time this month, the highest rate in three decades.“Markets are likely to remain focused on the risk that higher crude oil prices could add to inflationary pressures and, in turn, push interest rates higher,” Yokoo Akihiko, an analyst at Mitsubishi UFJ Bank, said in a note seen by the Reuters news agency.The price of oil has only continued to inch upwards as the US-Israel war on Iran shows no signs of resolving and energy facilities and shipping routes, including the Strait of Hormuz, continue to come under attack.Last week, Yemen’s Iran-aligned Houthi rebels advanced their forces to the Bab al-Mandeb strait, a critical bypass for Saudi oil choked off at the Strait of Hormuz.