US 30-Year Yield Hits Highest Since 2007 as Global Bond Rout Deepens

The global bond market is undergoing a rapid repricing that challenges the equity rally narrative of the past six weeks. Treasury yields across the curve are hitting multi-year highs, with the 30-year benchmark approaching territory last seen in 2007. The catalyst is unmistakable: oil prices are rising sharply due to Iran geopolitical tensions, stoking fears that central banks will be forced to hold rates higher for longer or even tighten further. This is a regime shift from the dovish rate-cut expectations that fueled the mega-cap equity and AI-chip boom.

On Friday, May 15, the broader market finally reacted. Equities reversed after weeks of record highs, with the S&P 500 and Nasdaq both posting losses. Semiconductor stocks including NVIDIA, AMD, and Broadcom sold off as rate-sensitive tech names faced headwinds. The Russell 2000 actually outperformed, suggesting a rotation out of expensive growth and into cheaper value plays. Cryptocurrencies also stumbled, with Bitcoin dipping below $79,000 and Ethereum falling 3.3% as investors de-risked portfolios.

The scale of the bond selloff is global. Gilts in the UK, Bunds in Germany, and Japanese government bonds are all moving higher in yield. The implication is stark: if inflationThe rate at which prices rise across an economy. takes hold and central banks are unable or unwilling to cut rates, the cost of equity capital rises, and expensive valuation multiples compress. This is especially painful for mega-cap tech stocks that have driven the market higher on the assumption of lower rates and faster AI-driven earnings growth.

Market participants are divided on whether this is a temporary pullback or a meaningful repricing. Some argue that the Iran disruption is transitory and oil prices will normalize. Others point to broader inflationThe rate at which prices rise across an economy. signals including wage growth, housing costs, and service-sector pricing as evidence that price pressures are sticky. The incoming Fed Chair Kevin Warsh will face immediate pressure to communicate a clear path on rates; if he hints at tightening, equities could face further selling.