Economist Steve Hanke said President Donald Trump’s tariffs, the Iran war and renewed inflation pressure have revived the "bond vigilantes" as U.S. Treasury yields climb. The 10-year yield reached 4.81% on Wednesday, while the two-year yield rose to 4.41%, its highest level since January 2025; the 30-year yield remained near a 19-year high reached in August. Brent crude moved toward $96 a barrel as renewed U.S.-Iran attacks added to inflation concerns, while higher 10-year yields can feed into mortgage rates. Investors cited by Reuters also pointed to rising federal borrowing, resilient economic growth, expectations that the Federal Reserve may keep interest rates elevated, weaker foreign demand for Treasuries and corporate borrowing for AI infrastructure. Saxo chief investment strategist Charu Chanana said markets are demanding greater compensation for inflation, fiscal risks and the volume of debt coming to market, making a 5% 10-year yield increasingly plausible before buyers return. Ed Yardeni, who coined the term "bond vigilantes," said the concerns were valid but did not believe yields were or would soon become prohibitively high. Macquarie strategists told the Associated Press that the selloff did not yet indicate excessive concern about a U.S. sovereign default. U.S. debt recently surpassed $40 trillion, the Congressional Budget Office projects a $1.9 trillion federal budget deficit for fiscal 2026, and Treasury has doubled planned long-end bond buybacks to at least $4 billion per operation beginning Sept. 9.