US 30-Year Treasury Yield Hits 19-Year High

The yield on the 30-year us Treasury has surged to its highest level in nearly two decades, with some strategists seeing scope for the selloff in long-dated government bonds to go further.

The 30-year Treasury yield, which is typically sensitive to geopolitical events, advanced more than 4 basis points to 5.311% on Monday, reaching its highest level since June 2007. Foreign holdings of Treasurys fell in June, with top holders UK, China, and Japan all reducing their holdings.

The sharp yield moves, while threatening to disrupt the Treasury futures market, create an arbitrage window for traders shorting CME Group Inc.’s futures contracts to buy cash bonds that are the cheapest to deliver, known as CTDs.

Those engaging in this type of basis trade can benefit from a so-called ‘switch-option,’ as sudden yield changes can see the cheapest-to-deliver security shift to a cheaper bond.

The selloff in the $31Tn US government bond market is opening the door for a potentially lucrative trade that profits from pricing shifts between derivatives and their underlying cash bonds.

However, Yardeni Research warned that investors are showing growing signs of unease over rising government debt, though it said there’s no reason to push the panic button on the US bond market just yet.

Reference Sources

1. cnbc - The 30-year Treasury yield just hit a 19-year high. Three things could drive it even higher
2. cnbc - Ed Yardeni on when it will be time to worry about the 'Bond Vigilantes'
3. bloomberg - Traders Alert for Deeper Bond Rout Fueling Niche Arbitrage Trade
4. bloomberg - Yardeni Warns Bond Vigilantes Stirring as US Yields Near 5%
5. barrons - 30-Year Yield Rises to Highest Level Since 2007 as Oil and Treasury Supply Bite Bonds

Anthropic’s Annualized Revenue Run Rate Hits $65 Billion

Ai startup Anthropic PBC is on track to generate annualized revenue of more than $65 billion based on its current performance, up more than Sevenfold from its pace at the end of last year.

The company's revenue run rate, a metric that projects full-year revenue from a shorter period, hit $65 billion by the end of July.

The dramatic acceleration in revenue bolsters Anthropic's plans for a public listing later this year.

Anthropic filed its prospectus with the Securities and Exchange Commission in June and has been holding preliminary meetings with potential investors, though it hasn't officially provided a Timeline for a debut.

Meanwhile, rival OpenAI has doubled its revenue to $40 billion, from $20 billion at the end of 2025.

Anthropic's investors expect it to continue to grow at approximately the same rate for the remainder of the year, finishing 2026 between $100 billion and $120 billion.

Reference Sources

1. latimes - Anthropic’s $65-billion revenue surge turbocharges IPO race with OpenAI
2. thestarmy - Anthropic revenue run rate tops $65 billion, source says
3. techcrunch - Anthropic’s annualized revenue surges to $65B
4. bloomberg - Anthropic Revenue Run Rate Surpasses $65 Billion Ahead of IPO
5. cnbc - Anthropic tells investors annualized revenue run rate climbed to $65 billion in July

India’s Protected Market May Be Holding Back R&D

India spent just 0.64% of its GDP on research and development in FY 2020-21, with nearly 60% of that R & D spending accounted for by the government sector.

In contrast, China spent 2.6% of its GDP on R&D in 2023, with businesses accounting for nearly 78% of that expenditure.

The difference is not merely the amount invested, but the role played by the private sector in driving innovation.

India continues to lag in cutting-edge industries such as AI, semiconductors, electronics, electric vehicles, and Renewables, while struggling to expand its exports. For a large market economy aspiring to become a global manufacturing powerhouse, this raises an important question: Why does India's private sector, especially its largest corporations with their capital, scale, and capabilities, invest so little in innovation? The answer lies in the incentives created by India's growth model. Businesses allocate capital to where risk-adjusted returns are highest.

India's trade and industrial policies have gradually altered those returns. Over the past decade, India has steadily raised import tariffs across a wide range of manufactured products.

The objective was to encourage domestic manufacturing, but it also changed corporate incentives. Higher import tariffs increased the relative attractiveness of the protected domestic market over competing in far more demanding export markets.

Reference Sources

1. nikkei - India's protected domestic market hinders R&D investment

The CommonWealth English daily news digest is a service curated by CommonWealth English team with the help of AI tools.  

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