Corporate Finance

The Federal Reserve's decision to raise interest rates for the first time since 2023 has collided with a resurgence in inflation and record government borrowing to push long-term Treasury yields to their highest levels in more than two decades, a combination executives ignore at their own cost.

The U.S. federal debt crossing 40 trillion dollars this week, alongside a spike in long-term Treasury yields, is a reminder that sovereign borrowing costs set the floor under every company's cost of capital.