Global bond markets face renewed sell-off

Government bond yields worldwide have risen significantly amid fears of rising inflation and increasing government debt. The yield on the 10-year U.S. Treasury bond reached 5.34%, the highest level since 2002, as borrowing costs increased in France, Britain, and Japan. These rises have led to higher interest expenses for governments, households, and businesses, potentially slowing economic growth and exerting more pressure on public finances, especially with U.S. debt exceeding $40 trillion. The increase in bond yields makes stocks less attractive and boosts investors' demand for financing instruments, particularly in the artificial intelligence sector, which has seen $220 billion in debt issuance this year to fund investments. Analysts view this phenomenon as a consequence of growing borrowing needs, with the possibility of yields continuing to rise unless governments take measures to reduce debt or promote growth.

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