Treasury Secretary Janet Yellen said that the surge in longer-term bond yields in recent months is a reflection of a strong US economy, not the jump in government borrowing driven by a widening fiscal deficit.

“I don’t think much of that is connected” to the US budget deficit, Yellen said at an event in Bloomberg’s Washington office Thursday. “We’re seeing yields go up in most advanced countries.”

The increase in yields — which has taken benchmark Treasury rates to the highest levels since before the global financial crisis — is instead “largely a reflection of the resilience people are seeing in the economy,” she said.

She spoke hours after data showed the US economy grew at an annualized rate of 4.9% in the third quarter, the fastest pace in nearly two years. Robust consumer spending was a key driver, in turn supported by a persistently strong labor market. Yellen said she wouldn’t be surprised if the US posts a growth rate of 2.5% for 2023.

“The economy is continuing to show tremendous robustness and that suggests that interest rates are likely to stay higher for longer,” she said.

Yields on benchmark Treasury securities have soared to the highest levels since before the global financial crisis in recent days, threatening to hobble economic growth and inflate already swelling US government borrowing needs. Federal Reserve Chair Jerome Powell last week said the moves are tightening financial conditions and could affect monetary policy decisions.

Powell, in remarks last Thursday, listed a number of potential reasons for the increase in longer-term yields. One factor could be that the economy is more resilient now to higher borrowing costs, he said.

Read More: US Economy Grew at a 4.9% Pace Last Quarter, Fastest Since 2021

Many bond market participants have pointed to the sharp increase in the federal deficit as being a key factor behind the increase in yields. The increasing supply of Treasuries comes at a time when traditional big buyers, including the Fed and other major central banks, have pulled back on bond buying. This has led the Treasury to rely more on hedge funds, mutual funds and pension funds to buy the new debt, which are more price-sensitive and in turn may require higher returns.

The size of the deficit itself could be another cause of concern. The US government’s budget deficit effectively doubled in 2023.

(Updates with further comments starting in second paragraph.)