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Global government borrowing costs jump to highs last seen in 2008 crisis

The 30-year US Treasury yield rose to 5.29%, while 30-year French bond yields reached 4.8558%, both at their highest levels since at least 2007 and September 2008, respectively.

Reported · Written up by our desk · Government Bonds

Government bond yields across major advanced economies climbed to levels not seen since the 2008 financial crisis, as investors worried that the Middle East conflict would keep inflation elevated and delay easing in monetary policy, The Guardian reports.

The outlet cited data showing France’s 30-year bond yield rising to 4.8558%, the highest since September 2008, and France’s 10-year yield moving up to 4.0516%, the highest since June 2009. Germany’s 30-year yield rose to 3.2138%, its highest since 2011, as traders demanded higher returns on government debt.

In the US, the 30-year Treasury yield increased to 5.29%, its highest since 2007, reflecting fears that persistent inflation would keep interest rates higher for longer. In Japan, the 10-year government bond yield reached 2.93%, a three-decade high, with markets looking for the Bank of Japan to raise rates as soon as September.

The report also linked the move in borrowing costs to rising energy prices, noting oil climbed 6% last week and that Brent crude rose further on Monday. It said money markets now imply about an 85% chance of an ECB rate increase in September, and that traders were positioning for continued central bank tightening to prevent inflation from running ahead.

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