Yields on 10-year Treasurys rose to 4.25% and two-year yields reached 4.07% amidst a bond market selloff. Analysts suggest that the market is reacting to uncertainties surrounding the upcoming election between Trump and Harris, particularly with concerns about increasing deficits if Trump is re-elected, given his proposed policies on tariffs and taxes. Economic data remains strong, leading to doubts about potential Federal Reserve rate cuts. The federal deficit has hit $1.8 trillion, contributing to the increased supply of bonds, which generally lowers demand and, consequently, prices. Overall, concerns regarding rising national debt and stronger-than-expected economic data are key factors dragging down the bond market. The selloff may persist as these dynamics continue to evolve.

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