Advertisement

SKIP ADVERTISEMENTYou have a preview view of this article while we are checking your access. When we have confirmed access, the full article content will load.

Bond Sell-Off Threatens to Squeeze Borrowers Around the World

Government bond yields are hitting multi-decade highs, reflecting anxiety about debt levels, deficits and inflation. The effects will extend to mortgages, business loans and other types of credit.

Reporting from London

Sept. 1, 2026

A global sell-off in government bonds intensified on Tuesday, pushing borrowing costs in some of the world’s largest economies to the highest levels in decades. The moves threaten to ripple through a wide range of debt, including business loans and mortgages for already stretched consumers.

A combination of factors is prompting investors to demand higher returns to hold government debt: a flood of borrowing by the world’s richest nations, expanding budget deficits, persistent inflation and few signs that countries are able or willing to take steps to improve these conditions.

The yield on 10-year U.S. Treasury notes, perhaps the world’s most influential interest rate, reached its highest since January 2025, briefly hitting 4.8 percent, and the yield on the 30-year bond continued to hover around a two-decade high. Yields move inversely to prices, so the rise in yields reflects a drop in prices.

America’s rising borrowing costs have set off a battle between Treasury Secretary Scott Bessent and investors, but the factors pushing up bond yields in the United States are also issues in other big markets.

“It’s a global story,” said Peter Schaffrik, a strategist at RBC Capital Markets in London.

The rise in oil prices since the start of the war in Iran has compounded worries about stubbornly high inflation. Mr. Bessent is joining international finance ministers this week in Asheville, N.C., for a Group of 20 meeting, as U.S. foreign policy continues to upend the global economy. On Tuesday, he downplayed the market moves. “I don’t think we’re in any kind of dire situation,” he said in an interview with Fox Business at the meeting.

This week, the yield on 10-year bonds in Japan climbed above 3 percent for the first time since 1996; in Britain, they reached their highest level since mid-2007; and in Germany, they hit levels last seen in 2011.

We are having trouble retrieving the article content.

Please enable JavaScript in your browser settings.

Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.

Thank you for your patience while we verify access.

Already a subscriber? Log in.

Want all of The Times? Subscribe.

Supported by

SKIP ADVERTISEMENT

10-year government bond yields

Advertisement

SKIP ADVERTISEMENT