Wall Street Chatter Grows That Fed May Act If Bond Rout Worsens

There’s a growing discussion on Wall Street that the Federal Reserve may need to step in to stabilize the Treasury market if the rout that briefly propelled long-term US borrowing costs above 5% continues.

Mounting doubts about the safety of US assets due to US President Donald Trump’s escalating trade war deepened the selloff in Treasuries on Wednesday, lifting the benchmark 30-year yield to briefly touch 5.02%, the highest since 2023. Should such moves continue, the central bank will need to act, Deutsche Bank AG and Jefferies strategists said, although they differed on how the Fed might do that.