Long-dated Treasury yields hit two-decade highs, pressuring corporate borrowers

The 10-year Treasury yield touched its highest level since 2002 on Monday, adding to the cost of corporate debt

Longer-dated U.S. Treasury yields climbed to their highest levels in more than two decades on Monday, as investors weighed new economic data and awaited minutes from the Federal Reserve's September meeting, CNBC reported.

The 10-year Treasury yield touched 5.349% intraday, its highest since April 2002, before settling at 5.307%, up 3 basis points on the day, according to CNBC. The 30-year Treasury yield rose about 3 basis points to 5.661%, after earlier reaching 5.703%, a level last seen in late May 2002.

The move adds to pressure on companies that financed themselves cheaply in past years and are now refinancing into a far costlier market. Rising debt-servicing costs squeeze corporate earnings, and some firms have been cutting spending or delaying investment to protect margins as older, low-rate debt comes due for renewal at today's steeper rates.

With long-dated yields staying elevated rather than easing, that squeeze on balance sheets looks set to persist. If funding costs remain high, long-dated Treasurys could stay under pressure as markets weigh persistent rate risk against continued corporate demand for credit.