Inflation concerns, elevated long-term yields and the outlook for central bank policy remained in focus in the U.S. Treasury market early Tuesday, May 19, 2026, following the previous week’s global bond sell-off.
The 10-year and 2-year Treasury yields were reported slightly lower early in the session, while the 30-year yield was described as remaining elevated.
Treasury yields had been little changed Monday. The 10-year yield was reported to have touched a 15-month high during that session.
Fund managers’ long-term yield expectations
A Bank of America survey published Tuesday showed 62% of global fund manager respondents targeting a 6% yield on 30-year Treasurys, compared with 20% targeting 4%. Those responses represent surveyed managers’ expectations, rather than an outcome or an assured forecast.
The 10-year Treasury yield serves as a benchmark for borrowing costs, while the 2-year note tends to respond more directly to expectations for Federal Reserve interest-rate decisions. Bond prices move in the opposite direction to yields.
Higher yields can put pressure on equity valuations, including rate-sensitive stocks, while elevated mortgage and credit-card borrowing costs can weigh on consumer spending.
Energy costs, borrowing and interest rates
Jefferies economist and strategist Mohit Kumar was quoted as identifying energy costs and deficit concerns as pressures on global bond markets. He expected oil prices to remain materially above pre-conflict levels in six months, even if a Middle East deal were reached.
Kumar also argued that household fuel subsidies could require more government borrowing and add pressure to longer-dated bonds. He questioned market expectations for interest-rate increases, arguing that weaker growth could make those expectations unjustified despite inflation pressures.
