Rising US 10-year treasury yields signal global economic shift: Insights from top economists

US 10-year treasury yields have been rising for five consecutive months now since April, 2023. If October witnesses another surge in yields, it will mark the longest monthly streak of increases since 1999.

What is significant is also the extent of the rise? From around 3.5% at the end of April to 3.7 in May to 3.85 in June to almost 4% in July to an average of 4.1% in August and almost 4.6% in September. October began with one peep above 4.8%. On average, the yields have risen by 130 basis points in five months.

While this is bound to have implications for growth and loan defaults in the US, the 10-year treasury is also the default benchmark cost of capital for the world and hence there are bound to be repercussions on the monetary policies of most countries.

To assess the reasons for this sharp rise, the future trajectory of the cost of capital and the impact on the global economy, CNBC-TV18’s Latha Venkatesh spoke to three top notch economists – Brian Coulton, the Chief Economist at Fitch Ratings; Robert Sockin, the Global Economist from Citi and Aditya Bhave the Senior US Economist from Bank of America.