Global Bond Yields Hit Multi-Decade Highs as Inflation and Debt Fears Deepen

  • U.K. 10-year gilt yields rose 7 basis points to 5.29% and German 10-year Bund yields reached 3.39%.
  • Brent crude traded at $92-$97 per barrel as renewed U.S.-Iran hostilities and European gas prices heightened inflation concerns.
  • Global yields pressured technology stocks and AI-related borrowing as investors reassessed deficits, issuance and interest-rate paths.

Government bond yields across major economies rose to multi-year or multi-decade highs as energy prices, inflation concerns, heavy sovereign and corporate issuance, and elevated public debt intensified a global selloff. On September 2, U.K. 10-year gilt yields climbed 7 basis points to 5.29%, their highest since August 2007, while German 10-year Bund yields rose 5 basis points to 3.39%, their highest since 2011; 30-year gilt yields approached 1998 levels. Brent crude traded in a $92-$97 per barrel range amid renewed U.S.-Iran hostilities in the Gulf, while European natural-gas prices also rose. Europe’s energy-import dependence amplified inflation risks and drove European and U.K. bonds to underperform U.S. Treasuries. U.S. borrowing costs also remained elevated, pressuring technology stocks and companies financing artificial-intelligence infrastructure with debt, while investors assessed central-bank policy, fiscal deficits and future earnings valuations.

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