U.S. 10-year Treasury yields have broken through the 4.53% mark, and market expectations for Fed rate hikes have surged dramatically. The following is the current data on the bond market crisis:

📊 U.S. Treasury yields: Breaking key levels
On May 15, 2026, the U.S. 10-year Treasury yield rose to 4.53%, the highest since May 2025, with the 30-year yield climbing to 5.056%, hitting a 10-month high. Over the past four weeks, yields have increased by a total of 22.30 basis points, and investors are facing the reality of "higher for longer" interest rates.
📈 Market expectations: Hike probability surging
Interest rate futures market pricing indicates that the market believes the Federal Reserve has over a 50% chance of raising rates before January 2027. Interest rate swap contracts show about a 37% chance of a rate hike before the end of 2026, and over a 50% chance before April 2027.
🏠 Mortgage rates: Approaching 7%
As of May 7, Freddie Mac's average 30-year fixed mortgage rate was 6.37%. However, due to rising rates, some 30-year loans have an APR as high as approximately 7.80% (6.30% + 1.50%).
🚗 Auto loan delinquency rates: 32-year high
Subprime auto loan delinquency rates have reached their highest level in 32 years, a record dating back to 1994. U.S. auto loan debt has reached $1.68 trillion, with average monthly payments between $680 and $774.
🔥 Inflation making a comeback
In April, the U.S. core CPI increased by 2.8% year-over-year, rising for the second consecutive month and marking the largest annual inflation increase in nearly three years. The April PPI soared 1.4% month-over-month and jumped 6.0% year-over-year, reaching a new high since December 2022. Meanwhile, consumer inflation expectations for the next year rose to 3.6%.
🏛 Trump tariffs pause: Bond market collapse as a trigger
On April 9, 2025, Trump suddenly authorized a 90-day suspension of "reciprocal tariffs" on most countries. Analysts widely believe that the collapse of the U.S. bond market was a key reason that forced Trump to make an emergency shift. At that time, the 10-year U.S. Treasury yield surged 50 basis points in one week, the largest weekly increase since 2001. Today, U.S. Treasury yields have surpassed the levels that triggered the pause back then.
#U.S. bond market crisis