Markets
The 10-Year Treasury Yield Jumped Back Above 5%
The 10-year Treasury yield rose more than 13 basis points to 5.125% on November 12, 2026, as bond trading resumed after Veterans Day and oil climbed.
Bond traders had two days of news to catch up on, and they did it in one session. When the Treasury cash market reopened on Thursday, November 12, after the Veterans Day holiday, the 10-year yield rose more than 13 basis points to 5.125%, according to CNBC, back above the 5% line it had dipped under. The 2-year yield climbed more than 15 basis points to 4.879% and the 30-year 10 basis points to 5.449%. A basis point is one hundredth of a percentage point, so moves of this size in a single day are rare for the world's benchmark bond.
The first push came from inflation. Tuesday's October consumer price report was hotter than expected, with core prices up 0.3% against a forecast of 0.2%, and futures had since moved to price a quarter-point Federal Reserve hike in December as certain: CME FedWatch showed 100% odds on Thursday and about a 13% chance of a half-point move. Goldman Sachs added another hike to its forecast, now expecting one in March as well. The second push came from oil. President Trump said "we don't need a deal with Iran," denting hopes that the Strait of Hormuz would reopen soon, and Brent settled 3.3% higher at $95.82 a barrel, with West Texas Intermediate up 2.55% at $88.74.
The short end rose the most, which flattened the curve. With the 2-year up more than the 10-year, the gap between them narrowed to roughly 22 to 24 basis points depending on the source. That pattern, yields rising and the curve flattening at the same time, is what traders call a bear flattener: it usually means the market expects the central bank to tighten, rather than worrying about long-term growth or government borrowing.
Other markets felt it. Gold, which pays no interest, fell 2.88% to $3,885.30 an ounce, and silver 3.72%. Small companies, which depend more on floating-rate debt, took the brunt in stocks: the Russell 2000 lost 1.66% while the S&P 500 fell 0.35%. Mortgage rates were already above 7% before the move, and the same morning the National Association of Realtors reported the weakest month for home sales since 2010.
Friday's producer price index is the next test, with economists expecting a 0.4% rise in October after September's 1.3% jump. A soft reading could take some heat out of the front end. A strong one would raise the question the futures market has only started to price, a half-point hike in December, and that is where the 2-year yield, more than the 10-year, would show it first.