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2026-09-16 06:54:08
[Global Government Bond Yields Surge, Borrowing Costs Near Pre-Financial Crisis Highs] 1. On Tuesday, global government borrowing costs rose to their highest level since the 2008 financial crisis. The yield on the 10-year US Treasury note briefly broke through 5.041%, a new high since 2007; the average yield on 10-year G7 government bonds rose to 4.285%, about 1 percentage point higher than before the Iran-Iraq War. 2. The Middle East conflict pushed oil prices back above $100 per barrel, increasing pressure on central banks to raise interest rates. The market expects the Federal Reserve to raise rates on Wednesday, followed by the Bank of Japan on Friday, and the European Central Bank, which raised rates last week and may continue to tighten. 3. Bond sell-offs have increased government interest payments, crowding out other fiscal space and raising concerns about debt sustainability. The yield on the 10-year Japanese bond broke through 3%, a 30-year high, while the UK yield rose to 5.45%, the highest since 2007, and the French yield hovered near an 18-year high. 4. Federal Reserve Chairman Warsh's lack of preference for forward guidance has increased market uncertainty. Analysts point out that artificial intelligence capital expenditures, fiscal concerns, and debt expansion have complicated the environment. The U.S. Treasury's recent interventions have had limited effect. 5. Some strategists believe the fundamental reason for the current weakness in the bond market is that the combination of monetary and fiscal policies is too loose, making it difficult to sustain inflation back to 2%; once inflation is resolved, many other problems will be easier to handle.
