-
- News
- Books
Featured Books
- design007 Magazine
Latest Issues
Current IssueDesigning Through the Noise
Our experts discuss the constantly evolving world of RF design, including the many tradeoffs, material considerations, and design tips and techniques that designers and design engineers need to know to succeed in this high-frequency realm.
Learning to Speak ‘Fab’
Our expert contributors clear up many of the miscommunication problems between PCB designers and their fab and assembly stakeholders. As you will see, a little extra planning early in the design cycle can go a long way toward maintaining open lines of communication with the fab and assembly folks.
Training New Designers
Where will we find the next generation of PCB designers and design engineers? Once we locate them, how will we train and educate them? What will PCB designers of the future need to master to deal with tomorrow’s technology?
- Articles
- Columns
Search Console
- Links
- Media kit
||| MENU - design007 Magazine
The Rising Term Premium: A Closer Look at the Implications of a Decade-high Surge
March 27, 2025 | Shawn DuBravac, IPCEstimated reading time: 1 minute

In recent months, financial markets have grappled with various conflicting signals, trying to reconcile strong economic performance with persistent uncertainties. While the U.S. economy appears robust and recession risks over the next 12 months have diminished significantly, several factors continue to drive an uncertain outlook.
One key development of this uncertainty has been the behavior of the “term premium.” The term premium was volatile in the wake of the pandemic, but recent increases highlight growing concerns about long-term economic risks. Since last fall, the term premium has been steadily rising, reflecting growing demand for compensation against long-term risks such as inflation and fiscal imbalances. In the early months of 2025, the term premium reached its highest level in a decade, signaling a significant recalibration in bond markets. This rise underscores the challenges facing policymakers, investors, and manufacturers as they navigate an environment marked by shifting economic dynamics and heightened sensitivity to risk.
What is the Term Premium?
The term premium represents the additional yield investors demand for holding long-term bonds instead of rolling over short-term bonds. It compensates for uncertainties over the bond's lifespan, such as changes in inflation, interest rates, or economic conditions.
Historically, the term premium has been influenced by monetary policy, economic stability, and market sentiment. Its recent rise marks a significant departure from the negative or near-zero levels that were common in the years following the Great Recession.
What’s Driving the Increase
The recent rise in the term premium is driven by a confluence of economic and market forces that reflect heightened uncertainty and evolving risks. Shifting inflation expectations are likely a contributing factor, as concerns over the potential for accelerating inflation persist. Sticky wage growth, volatile energy markets, and geopolitical tensions all fuel inflationary risks, prompting investors to demand higher compensation for the unpredictability of long-term bonds. Compounding this is the Federal Reserve’s quantitative tightening, which has reduced central bank support in bond markets. With the Fed scaling back its balance sheet, the absorption of long-term debt needs to increasingly shift toward private markets, increasing yields and the term premium.
Continue reading this article in the Spring 2025 issue of IPC Community.
Suggested Items
Notebook Industry Remains Cautious Amid Tariff Negotiations; 2025 Brand Shipments Growth Revised Down to 1.4%
04/22/2025 | TrendForceTrendForce’s latest research reveals that although the U.S. has granted a 90-day grace period before implementing reciprocal tariffs—offering temporary relief for notebook brands—the broader market remains clouded by policy and economic uncertainty. Brands began frontloading inventory in late 2024, pushing Q4 shipment growth to 5.1%, with 1Q25 seeing a 7.2% YoY increase.
Navigating Robotics Deployment Challenges with SINBON
04/18/2025 | PRNewswireIn spite of the potential for robotics technology to expand productivity, several implementation challenges continue to stand in the way of more widespread adoption.
Murata to Establish New Corporate Venture Capital Arm in the US
04/15/2025 | MurataMurata Manufacturing Co., Ltd., will establish WONDERSTONE Ventures, a new corporate venture capital (CVC) arm aimed at exploring new business opportunities and sustainable growth, in April 2025 in the US.
It’s Only Common Sense: Going After the Small Wins Fosters a Winning Culture
04/14/2025 | Dan Beaulieu -- Column: It's Only Common SenseThere is undeniable power in celebrating small victories. These aren’t just feel-good moments; they’re strategic opportunities to motivate, drive progress, and foster a winning culture. Too often, companies are so focused on the endgame—the massive goal at the horizon—they forget to acknowledge the crucial steps. However, those small wins are the lifeblood of success. Here’s why celebrating small victories is essential for businesses to thrive.
It’s Only Common Sense: Being Your Customer’s Expert—The Key to Consultative Sales
04/07/2025 | Dan Beaulieu -- Column: It's Only Common SenseWith successful sales, one phrase remains true: "Be your customer’s expert." Gone are the days of transactional sales where the buyer knows what they want, and your job is to provide it. Today, successful salespeople position themselves as trusted consultants, advisors, and experts. The key lies in mastering the art of consultative sales. Here’s what that means and how to adopt these principles to transform your sales approach and build long-term, fruitful relationships.