LONDON - The yield on the benchmark 10-year U.S. Treasury note rose above 5.0% on Monday, hitting the July 2007 milestone that it briefly attempted to scale last week.

The run-up in yields on the 10-year Treasury bond, seen as a safe-haven in times of economic uncertainty and a benchmark for borrowing costs around the world, has been driven by investors pricing in stronger U.S. growth as well as fiscal slippage.

Treasury borrowing costs have climbed, and a divided Congress has bickered over next year's spending bills while using stopgap measures to avert a shutdown of government operations.

In the background, the Fed is reducing its bond holdings.

In the year to September 2023, the U.S. government posted a $1.695 trillion budget deficit, a 23% jump from the prior year and the largest since a COVID-fueled $2.78 trillion gap in 2021.