Rising Treasury yields signal growth bets, not debt doubts

Rising long‑term Treasury yields reflect upgraded expectations for long‑run growth and a stable inflation outlook, not fears about Fed credibility or debt sustainability; inflation expectations stay anchored near the 2% target, the real yield term premium remains roughly stable, and faster growth from AI, deregulation and tax policy could improve the fiscal path as tariff revenue rebounds. With growth and disinflation ahead, deficits should shrink, and prudent policy—more liquidity at the long end and shorter‑term issuance—helps avoid unnecessary volatility.