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Rising Inflation And Debt Concerns Rattle Global Bond Markets

The latest pressure follows stronger-than-expected US economic growth and inflation readings that remain above the Federal Reserve’s target

,   and  TIPP Staff
2 min read
Photo by Joshua Woroniecki / Unsplash

The US bond market is facing renewed pressure as the 10-year Treasury yield climbed to 5.34%, its highest level since 2002, according to CNN.

Investors have been selling government bonds and demanding higher returns as inflation remains elevated. Rising gasoline and diesel prices have increased concerns about the erosion of investment returns, while markets are also pricing in further Federal Reserve interest-rate increases.

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The latest pressure follows stronger-than-expected US economic growth and inflation readings that remain above the Federal Reserve’s target. Consumer spending remains strong, unemployment is low, and massive investment in artificial intelligence infrastructure continues to support economic activity.

Government debt is another concern. Large-scale federal spending by both political parties has added to worries about the country’s long-term fiscal position.

The pressure is not limited to the United States. Higher oil prices, renewed inflation and debt concerns are pushing borrowing costs higher globally. The UK’s 30-year government bond yield reached 6% on Thursday, its highest level since 1998, according to the report.

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