The tariff fallout hit the US Treasury market, with longer-term yields surging by the most since the onset of the Covid pandemic in 2020. The higher borrowing costs add another shock to the global economy, which has been hobbled by President Donald Trump’s tariff onslaught.

The scale of the moves has fueled speculation that overseas investors may be selling bonds to retaliate against Trump for launching his trade war, although Treasury Secretary Scott Bessent played down the selloff, calling it “one of these deleveraging convulsions.”