US long-term borrowing costs have reached their highest level since 2001 after the Treasury sold 30-year bonds at a yield of 5.216%. The result signals investor concern that inflation may remain elevated and that the United States’ growing debt and budget deficit will require higher returns to attract buyers, increasing pressure on the government’s finances.

The $25bn bond sale came amid concerns about Donald Trump’s spending plans, tax cuts and tariff refunds, all of which could widen the deficit. Higher yields mean lower bond prices and may indicate expectations that interest rates will stay high; analysts warn that investors could demand still greater compensation for inflation and fiscal risks. The article also reports that the Bank of Japan may raise interest rates as early as September in response to inflation and yen weakness.