NEW YORK — A plunge in a closely watched Treasury yield yesterday spells relief for some borrowers who want to buy homes and big-ticket items like cars but is a threat to retirement portfolios and the broader economy.

A vigorous Treasury rally sent the benchmark yield on the 10-year Treasury note below 4 percent for the first time since September 2005.

Heavy losses on global stock exchanges, alongside escalating credit fears and a surge in oil prices above the $99-a-barrel level, caused nervous investors to clamor for Treasurys, which carry a government guarantee.

The rally put pressure on yields as prices and yields move in opposite directions.

The benchmark yield is used to set 30-year fixed-rate mortgages. Other mortgages and consumer loans for items like autos and appliances often are tied to the yield on the two-year note, which yesterday dropped below 3 percent for the first time in almost three years.

"What we are seeing is an overall motion toward lower rates," said Brian Bethune, U.S. economist at Global Insight.

Of course, it must be remembered that housing market conditions are dire in many regions and the ranks of U.S. home buyers are dwindling.

In addition, some consumer loans are pegged to London Interbank Offered Rates.

And those loans faced higher rates because three-month LIBOR rates were reset higher yesterday.

Still, people able to take out new fixed-rate mortgages pegged to the 10-year yield should enjoy lower rates.

And owners of current adjustable-rate mortgages and loans for other big-ticket items tied to the two-year note yield also should benefit.