The world’s most important market is flashing red about the Iran war | CNN Business

Rising oil prices, persistent inflation fears and shifting expectations for rate hikes are rattling the world’s largest bond market, sending Treasury yields higher and pushing up borrowing costs for consumers. The 10-year US Treasury yield on Thursday rose four basis points, to 4.71%, its highest level since January 2025. Prior to the war with Iran, which started in late February, the 10-year yield dipped below 4%. Renewed tensions between Washington and Tehran have pushed up oil prices once again, with Brent crude surging 7% on Thursday to hit $100 per barrel. The conflict has rocked the massive US Treasury market — with roughly $30 trillion in value — as investors weigh the impact of surging oil prices and the possibility that the Federal Reserve could keep interest rates higher for longer, or even raise them, if inflationary pressures intensify. Bond yields rise when prices fall. Markets are pricing in a 36% chance the Fed hikes rates at its policy meeting next week, according to CME FedWatch. Investors are also demanding a higher yield on Treasuries to compensate for the risk of inflation eating into their return. The US 10-year yield helps determine borrowing costs acros