The fed rate is, roughly, the rate for new government borrowing. So newly issued bonds will have to pay higher prevailing rates. Also, most bonds only pay int

The fed rate is, roughly, the rate for new government borrowing. So newly issued bonds will have to pay higher prevailing rates. Also, most bonds only pay interest over their life, so the government still owes the initial principal when they mature. That principal has to be paid, usually by issuing new bonds, which will pay the new, higher prevailing rates. Average time-to-go for US government debt is something like 5 years[1], so that process moves pretty slowly. [1]: https://www.brookings.edu/blog/up-front/2022/07/27/projecting-the-structure-of-us-treasury-debt/ https://www.brookings.edu/blog/up-front/2022/07/27/projectin...