Prof G Markets · Thursday, September 3, 2026
Global bond markets are experiencing their worst performance in years, with yields hitting multi-year highs across Japan, Germany, France, the UK, and the US. This sell-off is attributed to a confluence of factors including rising energy prices, inflation, unsustainable government debt, hawkish central bank sentiment, and significant debt issuance for AI infrastructure.
“Around the world, bond markets are having their worst stretch in years.”
“Japan's 10-year yield hit 3% for the first time in three decades.”
“This global sell-off reflects the countless worries that investors are now forced to reckon with, including climbing energy prices and hot inflation due to the war in Iran, unsustainable levels of government debt, hawkish sentiment from the Federal Reserve, and also the enormous amounts of debt that is now being issued to fund the AI build out, as we discussed earlier this week.”