Student loan interest rates to rise with Treasury 10-year note

College students in the U.S. who take out federal loans are likely to see interest rates jump — potentially by a percentage point or more — in the coming academic year.

Last year, the government began to peg rates on most student loans to the Treasury 10-year note. Stafford loans, the most widely borrowed, carried an undergraduate rate of 3.86 percent for the 2013-2014 school year. In the past three months, the 10-year yield has traded 0.80 to 1 percentage point higher than a year ago, which means education borrowing costs may rise.