Sovereign Yields Plummet as Inflation Fears Drive Global Bond Selloff

The global sovereign bond selloff has continued for six consecutive days, pushing borrowing costs to multi-year and multi-decade peaks.

In Europe, Germany's two-year Schatz yield rose to 2.983%, its highest level since 2024, while the benchmark German 10-year Bund yield climbed to a 2011 high of 3.370%.

France's 10-year OAT yield reached levels not seen since the height of the 2008 global financial crisis, escalating to 4.244% due to mounting fiscal deficits and broader rate pressures across the single-currency bloc.

Aussie yields surged on a GDP beat and hot July inflation readout, with Australia's benchmark 10-year government bond yield jumping to 5.205%, its highest since 2011.