Renewed US-Iran strikes over the weekend sent crude sharply higher Monday, reviving inflation fears and pushing the 10-year Treasury yield to its highest since January 2025 as U.S. equities fell.
President Trump posted late Sunday that Iran’s main crude export terminal was “being blown to smithereens.” And Iran’s Revolutionary Guards said Sunday they’d struck U.S. bases in Jordan and the UAE in retaliation.
West Texas Intermediate crude jumped 2.5% to $85.49 a barrel, while Brent added 2.7% to $90.47 — feeding straight into the rates market.
The 10-year Treasury yield rose 5 basis points to 4.76%, a fourth consecutive advance and the highest since January 2025. The 30-year climbed 6 basis points to 5.26%, while the 2-year eased 1 basis point to 4.34%.
Traders now assign roughly a 64% probability to a 25-basis-point rate hike at the Sept. 16 Federal Reserve meeting, up from about 40% a week ago.
