Economists Peter Schiff and Mohamed El-Erian flagged the 30-year U.S. Treasury yield’s steady climb to multi-decade highs, warning the move could weigh heavily on the housing market and borrowing costs.

A 25-Year Climb, Now Accelerating

“Slowly and steadily, the 30-year US Treasury yield is heading toward 5.30%, a level the economy, and the housing market in particular, has not seen in decades,” El-Erian said on X, sharing a Bloomberg chart tracking the yield’s climb.

The chart shows the 30-year yield has surged from below 1% in March 2020 to above 5.27% on Monday, marking one of the sharpest sustained moves in the yield’s 25-year trading history and pushing the yield back toward levels last seen in 2007.

Schiff replied to El-Erian’s post, noting the yield has already moved past that mark.

“It’s now past 5.3% and headed higher,” Schiff said, adding that “5.5% is the next objective.”

Yields Are Already At An 19-Year High

The 30-year Treasury yield climbed to 5.31% on Monday, its highest level since June 2007, even as expectations for a near-term Federal Reserve rate hike have eased.

The CME FedWatch Tool shows just a 36% chance of a interest rate hike in September, down from 48% a week earlier.

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ETFs Exposed to Treasury

The iShares 20+ Year Treasury Bond ETF (NASDAQ:TLT) has $45.73 billion in assets and a 0.15% expense ratio, has lost 6.53% year-to-date and 5.57% over the past year.

The Vanguard Extended Duration Treasury ETF (NYSE:EDV) has fallen 9.65% so far this year and 9.09% over the past year. It has $3.40 billion in assets under management and charges an expense ratio of 0.05%.

US Treasury 30 Year Bond ETF (NASDAQ:UTHY), which manages $181.37 million in assets with a 0.15% expense ratio, has fallen 6.50% year-to-date and 5.58% over the past year.

Price Action: The iShares 20+ Year Treasury Bond ETF fell 0.25% on Monday at $81.35 and gained 0.12% in extended trading.

Benzinga edge rankings show the iShares 20+ Year Treasury Bond ETF has a Momentum score in the 18th percentile and a negative price trend across the short, medium, and long-term.

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Disclaimer: This content was produced with the help of AI tools and was reviewed and published by Benzinga editors

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