Recent strength in U.S. economic data, including August nonfarm payrolls that exceeded forecasts, has reinforced trader expectations for a potential Federal Reserve rate hike in September and kept the 30-year Treasury yield anchored near 5.24% as of September 4. Persistent inflation above the Fed’s 2% target, combined with heavy Treasury supply amid structural budget deficits exceeding 6% of GDP and competition for capital from AI-related investment, has elevated the term premium and limited downside in long-duration yields. Federal Reserve Governor Christopher Waller recently highlighted the diminished safety premium on Treasuries and the need for patience on policy amid cooling but still-elevated price pressures. With the next FOMC meeting and key inflation releases scheduled later this month, market-implied odds reflect caution that yields could test lower levels without clearer evidence of disinflation or a dovish policy pivot.