{"id":3736,"date":"2026-08-19T08:36:20","date_gmt":"2026-08-19T08:36:20","guid":{"rendered":"https:\/\/blog.cedritech.com\/?p=3736"},"modified":"2026-08-19T08:36:20","modified_gmt":"2026-08-19T08:36:20","slug":"government-borrowing-costs-hit-highest-level-since-2007","status":"publish","type":"post","link":"https:\/\/blog.cedritech.com\/?p=3736","title":{"rendered":"Government borrowing costs hit highest level since 2007"},"content":{"rendered":"<p class=\"mb-4 text-lg md:leading-8 break-words\">Long-term government borrowing costs climbed to their highest level in nearly two decades as the\u00a0Iran war\u00a0showed little sign of a resolution and investors feared persistent\u00a0inflation.<\/p>\n<p class=\"mb-4 text-lg md:leading-8 break-words\">The 30-year Treasury yield jumped to 5.32%, registering its highest level since 2007, before dropping slightly lower. The surge in borrowing costs threatens to raise mortgages and credit card rates, since long-term bond yields help\u00a0set\u00a0interest payments for various consumer loans.<\/p>\n<p class=\"mb-4 text-lg md:leading-8 break-words\">Will gas prices fall if companies build oil routes that bypass the Strait of Hormuz? Experts explain<\/p>\n<div class=\"max-md:faux-bleed mb-4 bg-accent\/2 pb-5 md:invisible md:mb-0 md:h-0 md:overflow-hidden md:pb-0\">\n<div class=\"py-2 text-center text-xs uppercase\"><\/div>\n<div class=\"flex w-full flex-nowrap justify-center\"><\/div>\n<\/div>\n<p class=\"mb-4 text-lg md:leading-8 break-words\">Major stock indexes fell in response to rising yields. The Dow Jones Industrial Average ticked down 15 points, or 0.03%, while the S&amp;P 500 dropped 0.4%. The tech-heavy Nasdaq declined 1%.<\/p>\n<div class=\"mb-4\"><\/div>\n<p class=\"mb-4 text-lg md:leading-8 break-words\">Since bonds pay a given investor a fixed amount each year, the specter of inflation risks higher consumer prices that would eat away at those annual payouts. As a result, investors tend to sell off bonds if they fear a prolonged bout of inflation.<\/p>\n<p class=\"mb-4 text-lg md:leading-8 break-words\">In this case, a global\u00a0oil shock\u00a0has pushed up energy prices which in turn has trickled into other costs, such as\u00a0groceries.<\/p>\n<p class=\"mb-4 text-lg md:leading-8 break-words\">Global oil prices ticked above $91 a barrel on Tuesday, up nearly 30% since the outbreak of the Iran war in late February. The average price of a gallon of gas is $4.06, putting it well above an average of $2.98 before the war,\u00a0AAA\u00a0data showed.<\/p>\n<div class=\"max-md:faux-bleed mb-4 bg-accent\/2 pb-5 md:invisible md:mb-0 md:h-0 md:overflow-hidden md:pb-0\">\n<div class=\"py-2 text-center text-xs uppercase\"><\/div>\n<div class=\"flex w-full flex-nowrap justify-center\"><\/div>\n<\/div>\n<p class=\"mb-4 text-lg md:leading-8 break-words\">Iran&#8217;s near-closure of the Strait of Hormuz choked off a trade route responsible for about 20% of global oil supply. A U.S. blockade of Iranian ships deepened the crude shortage. On-again, off-again negotiations have failed to restore tanker tariff in the strait.<\/p>\n<figure class=\"relative mb-4\">\n<div class=\"relative\"><img loading=\"lazy\" decoding=\"async\" class=\"rounded-lg\" src=\"https:\/\/s.yimg.com\/lo\/mysterio\/api\/4353e685b8bd83f363db3adc1977052aa16ff21a3914235090733ba2a4ddac17\/lightyear_networkapi\/resizefill_w960%3Bquality_80%3Bformat_webp\/https%3A%2F%2Fmedia.zenfs.com%2Fen%2Fus.abcnews.go.com%2F6db7fe6083f07242d9cd31e90b2faa52.jpg\" alt=\"Steve Heap\/Adobe Stock - PHOTO: Stock photo of a for sale sign in front of a home.\" width=\"960\" height=\"640\" data-nimg=\"1\" \/><button class=\"group absolute bottom-0 size-full\" aria-label=\"View larger image\" data-ylk=\"elm:expand;itc:1;sec:image-lightbox;slk:lightbox-open;\" data-rapid_p=\"14\" data-y-link-id=\"02huos0090pas5182o3x\" data-v9y=\"1\"><\/button><\/div><figcaption class=\"relative text-sm mt-1 pr-2.5\">\n<div>\n<p>Steve Heap\/Adobe Stock &#8211; PHOTO: Stock photo of a for sale sign in front of a home.<\/p>\n<\/div>\n<\/figcaption><\/figure>\n<p class=\"mb-4 text-lg md:leading-8 break-words\">An average of about 13 ships crossed the strait each day last week, oil data company Kpler said in a post on\u00a0X, down from more than 100 ships per day before the recent conflict.<\/p>\n<p class=\"mb-4 text-lg md:leading-8 break-words\">Inflation, in turn, has stayed elevated. Prices rose 3.4% in July compared to a year earlier, marking a slight cooldown from the prior month, federal government data last week showed.<\/p>\n<p class=\"mb-4 text-lg md:leading-8 break-words\">Still, inflation stands more than a percentage point higher than the Federal Reserve&#8217;s target rate of 2%.<\/p>\n<div class=\"max-md:faux-bleed mb-4 bg-accent\/2 pb-5 md:invisible md:mb-0 md:h-0 md:overflow-hidden md:pb-0\">\n<div class=\"py-2 text-center text-xs uppercase\"><\/div>\n<div class=\"flex w-full flex-nowrap justify-center\"><\/div>\n<\/div>\n<p class=\"mb-4 text-lg md:leading-8 break-words\">The Fed, meanwhile, has\u00a0opted against imposing interest rate hikes in response to the oil-driven rise in prices. The central bank could hike rates in an effort to cool off prices, but the move risks an economic slowdown that may pinch hiring.<\/p>\n<div class=\"mb-4\">\n<div id=\"recirc-3224ad5a-7319-329d-b506-bee220c9b20c\" class=\"mb-4\">\n<div class=\"grid gap-4 lg:grid-cols-2 lg:grid-rows-[auto_auto_1fr]\">\n<div class=\"relative w-full\">\n<div class=\"relative hidden md:flex\">\n<div class=\"grow\">\n<div class=\"h-4 bg-tertiary w-2\/5\"><\/div>\n<\/div>\n<\/div>\n<div id=\"_r_sa_\" class=\"absolute inset-0 rounded-[4px] focus-within:ring-2 focus-within:ring-link\"><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<p class=\"mb-4 text-lg md:leading-8 break-words\">Inflation surge has squeezed shoppers. Sluggish pay has made it worse<\/p>\n<p class=\"mb-4 text-lg md:leading-8 break-words\">Fed Chair Kevin Warsh, who took the helm of the central bank this summer, has repeatedly vowed to dial back inflation.<\/p>\n<p class=\"mb-4 text-lg md:leading-8 break-words\">&#8220;The committee remains resolute &#8212; you&#8217;ve heard this before &#8212; that we will deliver price stability,&#8221; Warsh told reporters in Washington, D.C., last month.<\/p>\n<p class=\"mb-4 text-lg md:leading-8 break-words\">Investors, however, appear skeptical of the central bank&#8217;s willingness to urgently increase rates.<\/p>\n<p class=\"mb-4 text-lg md:leading-8 break-words\">Odds of a quarter-point rate hike at the Fed&#8217;s next meeting in September stand at 34%, according to the\u00a0CME Group&#8217;s FedWatch Tool, a measure of market sentiment.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Long-term government borrowing costs climbed to their highest level in nearly two decades as the\u00a0Iran war\u00a0showed little sign<\/p>\n","protected":false},"author":6,"featured_media":3737,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"om_disable_all_campaigns":false,"_monsterinsights_skip_tracking":false,"footnotes":""},"categories":[49,88,48],"tags":[],"class_list":["post-3736","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economy","category-finance","category-us"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/blog.cedritech.com\/index.php?rest_route=\/wp\/v2\/posts\/3736","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blog.cedritech.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blog.cedritech.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blog.cedritech.com\/index.php?rest_route=\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/blog.cedritech.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=3736"}],"version-history":[{"count":1,"href":"https:\/\/blog.cedritech.com\/index.php?rest_route=\/wp\/v2\/posts\/3736\/revisions"}],"predecessor-version":[{"id":3738,"href":"https:\/\/blog.cedritech.com\/index.php?rest_route=\/wp\/v2\/posts\/3736\/revisions\/3738"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/blog.cedritech.com\/index.php?rest_route=\/wp\/v2\/media\/3737"}],"wp:attachment":[{"href":"https:\/\/blog.cedritech.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=3736"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blog.cedritech.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=3736"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blog.cedritech.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=3736"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}