- Jamie Dimon warned that Treasury yields and borrowing costs could continue rising as investors reassess inflation, government debt, and global growth risks.
- Long-dated US bond yields surged to multi-year highs after renewed inflation fears tied to oil prices, geopolitical tensions, and deficit spending rattled markets.
- Higher rates could pressure commercial real estate refinancing activity, particularly for borrowers facing maturities over the next two years.
Globe St reports that long-term Treasury yields are climbing back toward levels last seen before the Global Financial Crisis, and JPMorgan CEO Jamie Dimon says markets may still be underestimating how high rates can go. In an interview with Bloomberg Television, Dimon warned that investors have become too comfortable assuming interest rates will eventually move lower.
The comments come as a bond market selloff pushes long-dated US Treasury yields to multi-year highs. According to Financial Post reporting published May 22, the 30-year Treasury yield briefly reached its highest level since 2007, while two-year yields climbed to their highest point since February 2025.
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Why Bond Markets Are Rattled
Investors have been unloading longer-duration government debt amid concerns that inflation could remain elevated longer than expected. Rising oil prices linked to tensions involving Iran, combined with persistent US deficit spending and resilient economic growth, have all contributed to upward pressure on Treasury yields.
Dimon pointed to a broader structural concern around global savings and government borrowing. “We may have gone from a saving glut to not enough savings,” he told Bloomberg, suggesting that demand for government debt may weaken as sovereign borrowing accelerates globally.
Markets also reacted sharply to developments in the Middle East this week. Treasury yields rose again Thursday after reports tied to Iran’s uranium stockpile triggered another spike in oil prices, though both yields and crude later pulled back on hopes of renewed US-Iran negotiations.
The Details
The US two-year Treasury yield climbed as high as 4.11% Thursday, while the 10-year yield reached 4.62%. Per Financial Post, traders are now pricing in a 70% probability of a quarter-point Federal Reserve rate hike by December 2026, a dramatic reversal from earlier expectations for multiple rate cuts this year.
Dimon also highlighted the scale of federal borrowing as a long-term market risk. The US government currently carries roughly $30T in debt, with an average interest rate near 3.5%, according to his comments. He warned refinancing that debt at higher rates could eventually strain both government finances and private credit markets.
“Rates can easily go up more, and credit spreads can go up more,” Dimon said, adding that many borrowers will eventually face refinancing at materially higher costs.
A Growing Concern for CRE Debt Markets
The bond market volatility has major implications for commercial real estate financing. Higher Treasury yields often widen cap rates and pressure valuations. Dimon has also warned that mounting stress in private credit markets could amplify refinancing risks across CRE.
According to MBA’s 2026 Commercial Real Estate Finance Outlook, more than $950B in CRE loans are scheduled to mature over the next two years. Many of those loans were originated during the ultra-low-rate environment of 2020 through 2022, creating refinancing gaps as current borrowing costs remain significantly higher.
The pressure is particularly acute for office owners. Per MSCI Real Assets data published in Q1 2026, office transaction volumes remain well below pre-pandemic levels as lenders continue tightening underwriting standards and buyers demand higher yields.
Why It Matters
Dimon’s warning reflects a broader shift in how markets are thinking about the “higher-for-longer” rate environment. For CRE investors, elevated Treasury yields ripple through virtually every corner of the industry, from construction lending and bridge debt to institutional pricing models and REIT valuations.
If inflation proves sticky and the Fed keeps policy tighter longer than expected, refinancing risk could intensify across commercial property sectors. Borrowers with floating-rate debt or upcoming maturities may face significantly higher debt service costs just as property fundamentals soften in certain markets.
What’s Next
Investors will closely watch upcoming inflation data, Treasury auctions, and Federal Reserve commentary for signs of where yields head next. Geopolitical developments tied to energy markets could also continue driving volatility in both bonds and commercial real estate financing conditions.
For CRE owners and lenders, the key question is whether today’s elevated Treasury yields become the new baseline — or the beginning of another leg higher in borrowing costs.
