What’s driving the rate?
I think it’s the $40 trillion debt number combined with the prospect of $300 to $600 billion in new bond issuances just this year by corporations needing to borrow for an AI build-out.
My guess is two fold although related. First its basic supply and demand, the government is borrowing more than the market wants right now. Second, probably the risks for default may be marginally higher so the market is looking for an increase in the risk premium.
Both of these assume a rational market which can often not be the case.
My guess would be that our government is borrowing more than the market can handle at the moment and that may be like a wave rather than a more permanent tide shift. But I am always optimistic.