U.S. Treasury yields have experienced notable fluctuations in July 2025. The 30-year Treasury yield climbed back above 5%, reaching 5.02%, its highest level in 18 years and nearing levels last seen in 2007. This rise has been driven by increased government spending and potential tax cuts, contributing to global volatility in long-term sovereign bond yields. The 10-year Treasury yield rose to a one-month high of 4.495% before dropping to 4.35%, falling below its 200-day moving average. Meanwhile, the 2-year Treasury yield rose to 3.934% but later resumed a slide, falling to 3.827%, its lowest since early July. The U.S. Treasury also conducted a $13 billion auction of 20-year bonds, with yields around 4.94% before dropping slightly post-sale. Inflation expectations, as measured by the University of Michigan survey, declined for both the one-year and five-to-ten-year horizons, with the one-year inflation expectation falling to 4.4% from 5.0% and the five-to-ten-year expectation dropping to 3.6% from 4.0%, both the lowest readings since February 2025. Additionally, the Atlanta Federal Reserve reported a decrease in business inflation expectations for July to 2.3%, down from 2.4%, alongside declining sales levels and profit margins compared to normal times. In the UK, government bond yields also rose, with two-year gilt yields reaching 3.912%, five-year yields at 4.093%, and 30-year gilt yields closing at 5.496%, reflecting ongoing fiscal challenges and mixed labor data.