FX.co ★ US 10-Year Bond Yield Extends Rebound

The yield on the 10-year US Treasury note climbed toward 4.5% on Monday, continuing the upward trend that began on Friday. This increase came in the wake of Moody’s decision to downgrade the US government's credit rating from Aaa to Aa1. This adjustment signifies the loss of the last triple-A credit rating among the three major credit rating agencies, following S&P's downgrade in 2011 and Fitch's downgrade in 2023. According to Moody's, the downgrade "reflects the increase over more than a decade in government debt and interest payment ratios to levels that are significantly higher than those of similarly rated sovereign entities." In an effort to downplay the downgrade, Treasury Secretary Scott Bessent stated on Sunday that the Trump administration would ensure that US economic growth surpasses its debt levels.