Bond Markets Plunge as Inflation Fears Drive Up Yields to Multi-Decade Highs

Global bond markets have been experiencing a sharp sell-off, driven by concerns over inflation and rising energy prices. The Middle East conflict has pushed up oil prices, leading investors to worry about inflation risks and ballooning government debt.

The yield on 10-year U.S. Treasury notes rose to near three-year high of 4.81%, while Japan's 10-year yield climbed above 3% for the first time in 30 years. Australia's 10-year government bond yields reached their highest level in over 15 years.

Charu Chanana, chief investment strategist at Saxo, warned that the selloff could overshoot, with a 5% yield on U.S. 10-year notes becoming increasingly plausible before investors return to the market.