5-Year Treasury Yield Tops 5% for First Time Since 2007 on Fed Rate Bets

The 5-year U.S. Treasury yield closed above 5% on Wednesday, Sept. 23, 2026, the first time since 2007, as stronger-than-expected economic data drove investors to raise bets on further Federal Reserve rate hikes. The yield jumped 20 basis points to 5.03%, surpassing the 4.99% peak hit in 2023 during the Fed's aggressive tightening campaign. Fed Governor Michael Barr said the central bank's rate increase last week was only a significant step in recalibrating monetary policy, signaling at least two more hikes may be needed to return inflation to the 2% target. Barr cited elevated inflation risks and diminishing labor-market risks. Meanwhile, TSMC reportedly will raise wafer foundry prices by 3% to 6% starting January 2027, with advanced nodes seeing larger increases, potentially raising Apple's chip procurement costs and fueling speculation over higher iPhone prices next year.