US 10-year Treasury yield breached 5.2%, hitting levels not seen in years. Polymarket traders now pricing in 54% odds it reaches 5.4% before 2027.

The spike reflects growing concerns about fiscal sustainability and inflation persistence. Markets are essentially betting on how much stress the bond market can absorb before triggering a crisis.

Higher yields increase borrowing costs for government, businesses, and consumers—potentially forcing Fed policy adjustments or sparking broader financial instability.