Government bond yields in the US and Europe continued to climb in early European trading on Thursday. US borrowing costs were approaching a 24-year high, while French government bonds came under pressure amid concerns over the fiscal deficit. MainSky Asset Management warned that France’s debt-to-GDP ratio could reach 130% by the end of 2027.
This signals a severe refinancing test for global sovereign debt and credit markets. At the 2026 Milken Institute Asia Summit in Singapore, institutions including Lord Abbett also warned that the $1.8 trillion private credit market’s default rate had risen to 3–4%, with maturing low-interest loans from the zero-rate era accelerating the exposure of risks.
A prolonged high-interest-rate environment is pushing up returns on risk-free assets overall and providing sustained support for the dollar and bond yields. Tightening global liquidity and mounting sovereign credit risks will further constrain the scope for valuation recovery in traditional risk assets.
For crypto markets, the substantial diversion of funds into high-yielding risk-free assets is dampening investors’ appetite to put new capital to work. Tight liquidity and spreading default risks could curb market leverage, while $BTC and high-beta tokens may face more significant liquidity discount pressures in the short term.
#BondYields #MacroRisk #GlobalDebt
This signals a severe refinancing test for global sovereign debt and credit markets. At the 2026 Milken Institute Asia Summit in Singapore, institutions including Lord Abbett also warned that the $1.8 trillion private credit market’s default rate had risen to 3–4%, with maturing low-interest loans from the zero-rate era accelerating the exposure of risks.
A prolonged high-interest-rate environment is pushing up returns on risk-free assets overall and providing sustained support for the dollar and bond yields. Tightening global liquidity and mounting sovereign credit risks will further constrain the scope for valuation recovery in traditional risk assets.
For crypto markets, the substantial diversion of funds into high-yielding risk-free assets is dampening investors’ appetite to put new capital to work. Tight liquidity and spreading default risks could curb market leverage, while $BTC and high-beta tokens may face more significant liquidity discount pressures in the short term.
#BondYields #MacroRisk #GlobalDebt