US Treasury yields fell on Thursday (5/23) after the 30-year US bond yield hit a 19-month high amid concerns about a widening US fiscal deficit, as Trump's "One Big Beautiful Bill" passed the US House and heads to the Senate.

Longer-term Treasury yields fell as Trump's tax-heavy budget passed the House, pushing fiscal concerns to the forefront

The US House of Representatives approved Trump's budget by a single vote on Thursday. The proposal, which would provide tax breaks on tips and loans on cars – made in the US – is expected to increase the deficit by $3.8 billion, according to the Congressional Budget Office (CBO).

The 30-year US Treasury yield hit 5.15% during the trading session, its highest level since November 2023, but has so far fallen to 5.05%, down three points (bps) from its opening level.

The benchmark 10-year US Treasury yield was at 4.545%, down five bps. However, the US Dollar Index (DXY), which measures the greenback against a basket of six currencies, shrugged off the decline in US yields and rose 0.26% to 99.95 at the time of writing.

Moody's downgraded the US government debt rating from negative AAA to stable Aa1 last week, triggering a spike across the US yield curve.

US President Donald Trump's unpredictable economic policies have triggered a spike in Treasury yields across the curve. Tariffs are considered inflation-prone, and the rising US fiscal deficit continues to pressure the bond market. (alg)

Source: FXstreet