On Tuesday, August 18th, global long-term government bonds faced renewed valuation pressure, particularly in the German bond market. The latest yield on German 10-year bonds was approximately 3.25%, near its highest level since 2011. Germany's July CPI rose 2.8% year-on-year, while the Eurozone's preliminary harmonized CPI for July was 2.9%, with energy prices rising 10.0% year-on-year. The European Central Bank is currently maintaining its deposit facility rate at 2.25%. This means that long-term bonds are no longer simply facing a policy rate issue, but rather a repricing effect resulting from simultaneous increases in inflation, fiscal supply, and term premiums. The issuance involved 30-year German bonds with a coupon rate of 2.90%, maturing in August 2056. This bond is not new; the benchmark maturity was first established in 2025, with continuous issuance thereafter. Official data shows that as of mid-July, its outstanding amount had reached €29.5 billion; the final yield of a €3.5 billion issuance in May this year was 3.53464%, while current long-term market yields are significantly higher than those levels. Therefore, what's truly worth observing is not the amount of a single financing transaction, but rather the maturity compensation demanded by investors. 30-year bonds have a longer duration, meaning that the same magnitude of yield change will generate greater price volatility. Historically, German government bonds have served as the core benchmark asset in the Eurozone interest rate system, but being a benchmark asset does not mean that the maturity premium must remain low. When fiscal supply increases and inflation volatility widens, even if credit risk does not change substantially, investors will demand higher holding compensation. The initial pricing of this issuance was approximately 0.4 basis points higher than the benchmark bond maturing in 2054, indicating that the primary market is still fine-tuning its pricing around adjacent maturity curves. This reflects the supply pressure and liquidity compensation of ultra-long-term bonds, rather than simple changes in credit risk. The biggest structural change in the German bond market comes from financing demand. The total expenditure in the draft federal budget for 2027 is approximately €555.4 billion, with net borrowing from the core budget alone reaching €148.8 billion; if extra-budgetary arrangements such as infrastructure are included, the overall financing scale will expand significantly. The government has announced an investment scale of approximately €118 billion in 2027. Market calculations further show that the net issuance of German government bonds in 2027 may rise to approximately €163 billion, higher than approximately €137 billion in 2026. Coupled with the repayment pressure of approximately €238 billion maturing, the gross financing scale could approach €400 billion. This changes the traditional valuation framework for European debt. In the past, long-term yields were more concerned with growth, inflation, and changes in the European Central Bank's policy path; now, the variable of continuous net bond supply must also be taken into account. When debt maturities are lengthened, the impact of fiscal spending on the bond market is reflected not only in the total amount of debt but also in the duration supply. The amount of ultra-long duration that insurance institutions, pension funds, and asset management institutions can absorb determines how much maturity premium is needed to achieve market liquidation after an increase in issuance. In other words, fiscal policy is directly influencing the yield curve through the supply side, rather than relying entirely on the indirect transmission of monetary policy. The Eurozone's preliminary inflation reading for July reached 2.9%, higher than June's 2.8%, with energy inflation rising from 8.5% to 10.0% and service prices increasing by 3.3% year-on-year. Germany's own CPI also rose to 2.8% in July from 2.3% in June. These data indicate significant disruptions to the short-term inflation decline. The European Central Bank maintained its deposit facility rate at 2.25%, main refinancing rate at 2.40%, and marginal lending rate at 2.65% at its July meeting, and continued to emphasize the uncertainty surrounding the duration of the energy shock and the impact of a second round of price fluctuations. From a technical perspective, the yields on German 1-year government bonds are approximately 2.60%, 10-year bonds approximately 3.25%, and 15-year bonds approximately 3.54%, with the longer end significantly higher than the shorter end. The yield curve maintains a positive slope and exhibits a high term premium. This structure cannot be simply interpreted as a one-way market judgment on policy rates. Long-term yields incorporate expectations of future short-term interest rates, inflation risk compensation, real interest rates, and term premiums. The current simultaneous presence of fiscal expansion and energy price shocks significantly increases the importance of term premiums. For the market, more critical indicators to observe are the slope of the 10- to 30-year yield curve, the spread between adjacent ultra-long-term bonds, the quality of primary market issuance orders, and the liquidity premium of new bonds relative to older bonds.