Yields on U.S. Treasury bonds rose across the curve on March 27, with the 10-year bond reaching 4.46% and the 30-year bond advancing to 4.986%. The movement represents the sharpest sell-off of bonds since the tariff crisis in April 2025.
The market now prices in the possibility of an interest rate hike by the Federal Reserve, instead of cuts. The change occurs about a month after the start of the conflict between the U.S. and Iran, which began with attacks at the end of February.
Bond market reaches alert levels of April 2025
The yield on the 10-year bond is now approaching the 4.5% level, which triggered a significant monetary policy reversal less than a year ago.
In April 2025, when the benchmark yield exceeded this level, Trump suspended his reciprocal tariffs within hours, describing the bond market as 'a little agitated.' This precedent is now in the spotlight. Crypto analyst Max Crypto highlighted the historical pattern and projected a new intervention from Trump to calm the market.
đ¨US BOND MARKET IS ENTERING A DANGER ZONE.
đşđ¸ US 10Y bond yield has spiked to 4.46%, its highest level in 8 months.
And now it's about to enter the 4.5% zone, which has always brought something good for markets.
April 2025: US paused reciprocal tariffs for 90 days after 10Y⌠pic.twitter.com/c5qrdAS32e
â Max Crypto (@MaxCrypto) March 27, 2026
Peter Schiff made the same parallel, referencing Trump's own words. He questioned whether the president would now suspend 'the war,' just as he paused the tariffs when reaching 4.52% last year.
â⌠On April 9, when the yield on the 10-year Treasury reached 4.52%, Trump suspended the tariffs on Liberation Day. According to him, the bond market became 'agitated.' Now, the yield on the 10-year bond is at 4.46% and rising. Once it exceeds 4.52%, the market is expected to react strongly. Will Trump suspend the war?â questioned Schiff on X.
During the same period, the yield on the 30-year bond reached 4.986%, the highest level since last September. This long-term movement indicates persistent concern about inflation and public debt costs in the coming years.
Short-term rates signal risk of Fed hike
The yield on the 2-year Treasury, the most sensitive to changes in the Fed's interest rate policy in the short term, jumped about 60 basis points since the beginning of tensions with Iran at the end of February. It reached 4.00% on March 27.
The movement represents a direct repricing of inflation expectations, and without intervention, the market could approach a full-blown crisis.
â⌠Inflation expectations have worsened so much that the market operates as if an emergency rate hike by the Fed is imminent,â said Adam Kobeissi.
Indeed, data from the CME FedWatch tool points to a high probability of a rate hike by the Fed in April, potentially reaching 5% due to the escalation of the war.
This percentage may increase if oil prices, which exceeded $100 per barrel since the escalation of disruptions in the Strait of Hormuz by Iran, continue to rise.
The conflict has eliminated expectations from early 2026 for multiple Fed rate cuts.
Global bond decline extends to Japan
The pressure is not limited to the US. The yield on the Japanese 10-year government bond rose to 2.38%, its highest level since 1999. The increase reflects fears of inflation due to high oil prices in an economy heavily reliant on imported energy.
The Bank of Japan kept interest rates unchanged at its March meeting but signaled the possibility of a hike as early as April.
Analysts are now pricing in a possible increase of 25 basis points to 1%. The rise in Japanese yields threatens the yen carry trade, an important source of global liquidity that has historically favored risk assets like Bitcoin and stocks.
For crypto markets, both yield movements are relevant.
Higher yields in the United States increase the opportunity cost of holding non-yielding assets, such as BTC.
The rate hike in Japan could trigger forced liquidations of leveraged positions funded in yen.
The bond market forced a policy reversal on tariffs in April 2025. It remains to be seen whether it can also provoke a reduction in geopolitical tensions next week.
If the yield on the 10-year bonds closes above 4.52%, historical analyses indicate that the White House will be pressured to act.
The article 'Bond Yields Spike with War in Iran and Expand Economic Risk' was first seen on BeInCrypto Brazil.