US 10-Year Bond Yields Hit 19-Year High: Markets Brace For Key Fed Decision

Last Updated:September 15, 2026, 10:22 pm IST

Brent crude futures again pushed towards $110 a barrel, while average diesel prices in the United States struck a record high of just under $6.27 a gallon.

The yield on the 10-year US Treasury note hit 5.03 percent, a level last seen in 2007 before the global financial crisis, as investors price in a likely hike in US interest rates.

Oil prices jumped, US bond yields rallied and equities retreated Tuesday as the Federal Reserve looked set to raise interest rates, with high inflation and AI concerns dominating market sentiment.

Brent crude futures again pushed towards $110 a barrel, while average diesel prices in the United States struck a record high of just under $6.27 a gallon, heaping pressure on President Donald Trump ahead of midterm congressional elections.

“There’s no let-up in the volatility rippling through financial markets, with energy prices staying painfully elevated and worries swirling about the knock-on effect for inflation and interest rates,” said Susannah Streeter, chief investment strategist at Wealth Club.

The yield on the 10-year US Treasury note hit 5.03 percent, a level last seen in 2007 before the global financial crisis, as investors price in a likely hike in US interest rates.

The US Federal Reserve began a rate-setting meeting Tuesday with markets expecting policymakers to pull the trigger on a hike to tackle persistently high consumer prices in the world’s biggest economy.

Market expectations for a 25-basis-point rate increase have risen sharply after official data published last week showed US annual inflation remaining far above the Fed’s target.

With the crisis in the Middle East showing little sign of abating and Yemen’s Houthi rebels taking control of a crucial outlet for shipping, crude has spiked this month to more than $100 a barrel.

The surge in energy costs has ramped up pressure on central banks to raise borrowing costs.

The European Central Bank last week lifted interest rates in the eurozone.

The Bank of England is forecast to maintain its benchmark rate on Thursday as the UK economy struggles for growth.

Wall Street’s main indices were lower in late morning trading on Tuesday, following losses in Europe and Asia.

There was renewed weakness for technology stocks after executives driving the AI sector said advances in artificial intelligence should be slowed.

“It looks as if investors are happier reducing some risk now, rather than leaving all their chips on the table, and mostly on the chip sector,” said Trade Nation analyst David Morrison.

Trump on Monday dismissed fears that artificial intelligence could wipe out humanity, repeatedly calling them a hoax and rejecting global calls to put guardrails around the fast-moving technology.

Anthropic chief Dario Amodei, whose company makes the popular Claude AI system, opened the floodgates on Saturday when he called for the sector to slow down.

His comments were echoed by OpenAI’s Sam Altman and SpaceXAI’s Elon Musk.

Microsoft on Monday published a “humanist AI code of conduct” as the concerns grew.

“AI should not exceed human control. Models should remain subordinate to humanity,” read one part.

(This story has not been edited by News18 staff and is published from a syndicated news agency feed – AFP)

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Why are US 10-year Treasury yields rising to their highest levels since 2007?

The yield on the 10-year US Treasury note hit 5.03 percent as investors price in a likely interest rate hike by the Federal Reserve. This surge is driven by persistently high consumer prices and rising energy costs, which have increased market expectations for a 25-basis-point rate increase.

How are rising energy prices impacting the US economy and political landscape?

Brent crude futures are pushing toward $110 a barrel, while average US diesel prices have reached a record high of just under $6.27 a gallon. This surge in energy costs is keeping inflation elevated and putting significant pressure on President Donald Trump ahead of the midterm congressional elections.

What recent developments have sparked concerns and market weakness in the AI sector?

Technology stocks faced renewed weakness after prominent AI executives, including Anthropic’s Dario Amodei, OpenAI’s Sam Altman, and SpaceXAI’s Elon Musk, called for a slowdown in artificial intelligence advances. In response to growing concerns, Microsoft published a “humanist AI code of conduct” stating that AI models must remain subordinate to humanity, though President Trump dismissed these existential fears as a hoax.

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Saurabh VermaDeputy News Editor

Saurabh Verma is a Deputy News Editor at News18.com, specialising in Indian politics and breaking global news. With years of experience tracking election strategies, he decodes domestic issues for mil…Read More

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