Japan's 10-year yield just hit 3.03% for the first time since 1996. Its 20-year yield is at 30-year high while the 30-year and 40-year are at record highs.
The UK's 10-year yield is at its highest since 2008. Its 30-year yield is at its highest since 1998.
France's 10-year yield is back to levels last seen around 2008. Germany's 10-year is at its highest since 2011.
The US 10 and 30-year yields are at a 19-year high.
This isn't happening because of one country's problem.
It's happening across almost every major government bond market at the same time.
Part of this is central banks.
The ECB just hiked rates again in September. Markets now see more than a 50% chance the Fed hikes this month too, and expect the Bank of Japan to raise its rate to 1.25%.
Rate hikes only explain part of this.
Long term yields also carry something called a term premium, extra compensation investors demand for holding debt over many years when inflation, government borrowing, and market risk are uncertain.
That premium has been rising too, especially in Japan, France, and the UK.
Here's what makes this cycle different from anything before it.
Global government debt is now close to 94% of world GDP, and the IMF expects it to hit 100% by 2029.
Global governments are now spending almost 3% of world GDP on interest payments alone, up from 2% just four years ago.
At the same time, AI is becoming a major source of new debt demand. The five biggest US tech companies are expected to spend around $697 billion this year on AI infrastructure.
A growing share of that is now funded through debt, and private credit funds are financing a lot of it, this AI segment alone went from 17% of private credit deals a few years ago to over a third of all deals in 2025.
This is why rising yields matter so much right now.
🇺🇸 NEW: The Fed is expected to hike rates for the first time since 2023, a move likely to strain Chair Kevin Warsh's relationship with President Trump, per Bloomberg.
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