Yields Soar as Oil Prices Reach Record Highs Amid Inflation Fears
Global bond yields hit multi-year highs on Thursday as investors grew increasingly concerned about inflation. The US and European stock markets declined, while oil prices surged above $100 a barrel due to worries of prolonged conflict in the Middle East.
The biggest spike in attacks on shipping since the Iran war began contributed to the increase in energy prices, which tightened supplies further. US President Donald Trump added to investors' inflation concerns by proposing to pay every US adult $5,000 if his party wins November's midterm elections.
The European Central Bank raised interest rates for the second time this year to combat an energy-driven inflation rise and warned that price pressures may prove lasting. This decision fueled bets on more policy tightening as soon as October.