30-year Treasury yield hits 19-year high as global bonds sell off

The 30-year Treasury yield climbed to 5.33% on August 18, its highest level since June 2007, as a broad selloff in government bonds pushed long-term borrowing costs higher across major economies. The move came as oil prices rose above $90 a barrel and investors faced growing concerns over inflation, public debt and a surge in corporate borrowing linked to artificial intelligence. Reuters also reported that the U.S. 30-year yield reached 5.327% during the session, its highest level since 2007.

The pressure extended beyond the United States. Japan’s 10-year government bond yield approached 3%, reaching a level not seen in three decades. Germany’s 10-year Bund yield reached its highest point since 2011, while French borrowing costs climbed to levels last seen in 2008. In the United Kingdom, the 30-year borrowing cost moved close to its highest level since 1998.

The global bond selloff reflects several pressures converging at the same time. Expectations for a political settlement between the United States and Iran weakened after a fragile ceasefire officially ended on Monday. The development reduced hopes for the reopening of the Strait of Hormuz and pushed Brent crude above $90 a barrel. Oil prices are now about 50% higher than at the start of the year.

Higher energy prices are adding to concerns that inflation could remain persistent. That is complicating expectations for interest rates and making long-term bonds less attractive to investors who are demanding greater compensation for holding debt over extended periods.

Public finances are adding another layer of pressure. U.S. federal debt is approaching $40 trillion, after increasing by about $5 trillion in two years. Interest payments alone reached $1.4 trillion over the past year.

The rise in bond yields has raised questions about whether investors are becoming less willing to absorb growing government debt without demanding higher returns. Capital Economics chief markets economist Jonas Goltermann said the move suggested investors were losing patience with loose fiscal policy.

DNB Carnegie chief economist Kjersti Haugland said bond markets were entering a period of greater uncertainty over inflation and interest rates. She pointed to high government debt levels in several major economies, including Japan, the United States, France and the United Kingdom.

The supply of corporate debt is adding to the pressure. Amazon, Alphabet, Meta and Oracle issued about $194 billion of bonds in 2026 through early July, according to a Reuters analysis of LSEG data cited by Benzinga. That was 79% more than the roughly $108 billion issued by the four companies during the whole of 2025.

Goldman Sachs expects bond issuance by Amazon, Alphabet, Meta, Oracle and Microsoft to reach $250 billion this year and $400 billion in 2027.

Debt linked to artificial intelligence now accounts for about 15% of total investment grade bond issuance, according to Barclays data. The expansion reflects the enormous financing needs of technology companies building data centers and other infrastructure required for AI development.

Thu Ha Chow, Robeco’s head of Asian fixed income, told Bloomberg that AI hyperscalers were relatively insensitive to financing costs because of the scale of their investment programs. Their ability to continue borrowing is increasing the supply of longer maturity corporate bonds at a time when governments are also seeking large amounts of capital.

The impact is already visible in corporate financing. Amazon had to offer investors an additional yield to complete a recent $25 billion bond sale. Spreads on bonds issued by major technology platforms have also widened across maturities.

U.S. Treasury markets remain at the center of investor attention. The 10-year Treasury yield is around 4.7%, approaching the 5% threshold that has historically attracted close attention from policymakers and investors. Reuters said rising Treasury yields are already reshaping financial conditions across the economy by increasing borrowing costs for households, companies and the U.S. government.

The combination of higher oil prices, expanding government debt and rising corporate issuance is creating a more difficult environment for long-term bonds. Investors must assess inflation risks, interest rate expectations, fiscal policy and the growing financing requirements of the AI sector at the same time.

For governments, higher yields mean more expensive debt servicing. For companies, they raise the cost of refinancing and new borrowing. For investors, they increase the risk associated with holding long-duration bonds.

The recent market moves therefore extend beyond a single increase in Treasury yields. They reflect a broader reassessment of long-term borrowing costs as governments and companies compete for capital while geopolitical and inflation risks remain elevated.