The 10-year US Treasury yield has climbed above 5%, its highest level since 2007. Market focus is shifting from immediate disruptions to the effects of a sustained 5%+ rate environment. A prolonged 5% benchmark will progressively transmit higher borrowing costs into housing, commercial real estate and highly leveraged firms, exposing financial-system vulnerabilities. Jack Ablin, CIO at Cresset Capital, said: "5% on the day won't break anything; the real problem shows up in 12 to 18 months when c

The 10-year US Treasury yield has climbed above 5%, its highest level since 2007. Market focus is shifting from immediate disruptions to the effects of a sustained 5%+ rate environment. A prolonged 5% benchmark will progressively transmit higher borrowing costs into housing, commercial real estate and highly leveraged firms, exposing financial-system vulnerabilities. Jack Ablin, CIO at Cresset Capital, said: "5% on the day won't break anything; the real problem shows up in 12 to 18 months when companies and borrowers must refinance at the new rates."