The US Treasury market faced another sharp bout of selling on Tuesday, with the yield on the 30 year Treasury bond rising for a sixth consecutive session and crossing 5.59 percent. The move pushed the long term yield to its highest level since 2002, when markets were dealing with the aftermath of the dot com bust.

The latest increase in Treasury yields comes amid a broader selloff in global government debt. Elevated crude oil prices linked to the ongoing conflict in the Middle East have added to inflationary pressures, increasing expectations that major central banks, including the Federal Reserve, may need to maintain or further tighten restrictive monetary policy.

The Treasury market has also been pressured by a large supply of corporate debt and growing concerns over US government borrowing and fiscal conditions. Strong business activity has added to the pressure by reinforcing expectations that the US economy may remain resilient enough to sustain higher interest rates.

The selloff has affected bonds across maturities. The 10 year Treasury yield reached 5.24 percent, its highest level since 2007, while the two year yield remained around 4.9 percent. A Bloomberg gauge shows that Treasuries have declined 2.6 percent so far this year, following a 6.3 percent gain in 2025.

Market strategists have highlighted several factors behind the recent weakness. Citigroup strategists described the situation as a light buyers strike, indicating reduced investor demand for Treasuries at current yield levels. Yardeni Research has also pointed to an unwinding of the yen funded carry trade as another factor contributing to pressure across global financial markets.

Seasonal factors could add to the pressure. Over the past decade, Treasuries have recorded a median loss of 0.9 percent in September and 0.7 percent in October, according to Bloomberg data. September is already shaping up to be the weakest month for Treasuries since 2023.

The outlook for the bond market remains closely linked to developments in the Middle East, US fiscal conditions and Federal Reserve policy. TD Securities strategist Prashant Newnaha said continued geopolitical uncertainty could lead to further de risking in fixed income markets and potentially spread into equities.

October could present another test for the Treasury market as government bond issuance increases and investors return from the summer period. State Street Investment Management strategist Masahiko Loo said renewed Treasury supply, heavy corporate credit issuance and continued spending on artificial intelligence infrastructure could intensify competition for capital.

Despite the recent selloff, some major bond investors see opportunities emerging at current yield levels. Investors including Jim Bianco, Chris Iggo and RBC BlueBay Asset Management CIO Mark Dowding have expressed more constructive views on Treasuries, arguing that the recent decline may have become excessive.