Moody’s Analytics Chief Economist Mark Zandi warned that the Iran war is fueling inflation and pushing long-term borrowing costs higher, prompting investors to shift from expecting Federal Reserve rate cuts to anticipating possible hikes.
Iran War Pushes Treasury Yields Higher
On Sunday, Zandi said in a post on X that long-term interest rates had climbed to levels not seen since before the Global Financial Crisis.
"Long-term interest rates are on the rise, and about as high as they’ve been since prior to the Global Financial Crisis," the Economist said.
"At the top of the list of reasons why is the Iran War," he said, noting that the 10-year Treasury yield was below 4% before the war but had risen to nearly 4.75% as of last Friday.
