US debt interest costs could rise by about $8 billion this fiscal year if 10-year Treasury yields stay at 4.58%.
The Financial Times (FT) reported that the yield stood above its pre-war level of 4% and the Congressional Budget Office’s February baseline of 4.13%.
The 10-year Treasury yield has reached its highest level since January 2025. The 30-year Treasury yield also hit its highest level since July 2007.
The FT also pointed out that a 4.58% yield through fiscal year 2027 could add just over $30 billion to US interest payments.
The CBO already projected US interest costs to rise from $1 trillion in 2026 to $2.1 trillion by 2036.
Investors have sold US government debt amid inflation fears after oil prices rose during the Iran conflict, according to the report.
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Treasury Secretary Scott Bessent said stronger growth under President Donald Trump’s policies could ease the burden.
