CounterPunch Exclusives

CounterPunch Exclusives

Trump’s Iran War Sent Interest Rates Soaring

Photo by Jungwoo Hong

Back in February, before Trump and Netanyahu attacked Iran, the interest rate on 10-year Treasury bonds was around 4.0%. It’s now hovering near 4.7%, an increase of 0.7 percentage points or 70 basis points. That’s a big deal for the economy.

Most immediately, it will be harder for people to buy a home, as mortgage interest rates have risen by roughly the same amount. For someone looking to borrow $300,000 to buy a house, Trump’s war has cost them an extra $2,100 a year in mortgage payments.

It will also make it more expensive for state and local governments to pay for infrastructure or borrow for other needs. And corporate borrowers will have to pay more, notably the hyperscalers who are spending massive sums for building out their network of data centers. If they are carrying another $1 trillion in debt after a couple of years, a jump of 70 basis points will add $7 billion a year to their interest payments, in addition to the impact of any increase in the........

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