Global Bond Market Faces Sell-Off Amid Inflation Concerns

Investor concerns over accelerating inflation have triggered a sell-off in the global bond market, leading to a rise in U.S. long-term Treasury yields to their highest levels in nearly three years. According to Jin10, the yield on the 30-year U.S. Treasury bond briefly increased by 4 basis points to 5.16%, marking the highest level since October 2023. This rise follows U.S. President Donald Trump's pressure on Iran to reach an agreement to end the Iranian war, which has contributed to continued gains in oil prices. Meanwhile, the yields on the 10-year and 2-year U.S. Treasury bonds reached 4.63% and 4.10%, respectively, the highest since February 2025. In Japan, the yield on the 30-year Japanese government bond surged by 20 basis points to 4.2%, the highest since its issuance in 1999. Bond traders often view the 5% yield level on the 30-year U.S. Treasury bond as a 'threshold,' believing it could attract bargain hunters. BNP Paribas' U.S. rate strategy head, Guneet Dhingra, commented, 'There is no anchor point above 5%.' He advises clients to focus on the trading range of 5.25% to 5.5% for the 30-year U.S. Treasury bond.