Global bond yields surge as era of cheap money ends

Global government bond markets are experiencing a significant surge in yields, signaling an end to the era of ultra-cheap money. In Japan, the benchmark 10-year government bond yield has climbed to approximately 2.90–2.93%, a level not seen since September 1996. This selloff is driven by the Bank of Japan’s pivot away from ultra-loose monetary policy and rising producer price inflation, which reached 7.2% in July.

This trend is mirrored in other major economies. France’s 30-year government bond yield has approached 4.85%, its highest range since the 2008 financial crisis. In Germany, 30-year Bund yields reached nearly 3.73%, the highest since 2011, while U.S. 30-year Treasury yields hit approximately 5.25%, their highest level since 2001.

Investors are increasingly demanding higher compensation to hold long-term debt, reflecting concerns over fiscal outlooks and rising borrowing costs. Analysts are closely monitoring yield thresholds, such as the 3.0–3.5% range for Japanese 10-year yields, which could trigger central bank intervention to manage rising debt-servicing costs.