Treasury yields fell sharply on Thursday, with investors turning to safe havens amid a steep sell-off in stocks driven by concerns around the artificial intelligence trade and surging oil prices.
The benchmark 10-year U.S. Treasury yield — used to price mortgages, auto loans and credit card debt — slid more than 17 basis points to 4.972%, the first time below 5% since Sept. 23. The yield saw its biggest one-day decline since March 10, 2023.
The yield on the 2-year Treasury note, which closely tracks short-term Federal Reserve rate policy, tumbled more than 16 basis points to 4.659%. The yield on longer-dated 30-year U.S. Treasury — most sensitive to geopolitical developments — was more than 14 basis points lower at 5.296%.
One basis point equals 0.01%, or 1/100th of 1%, and yields and prices move inversely to one another.
"It is a flight to safety," said Mitch Goldberg, president of ClientFirst Strategy. "People are all of a sudden terrified of the amount of bond issuance by AI-related companies. They see the rates going up and people want to hold on to something that they think will be there at maturity."