Ballooning government deficits, a Middle East conflict driving inflation fears and tech giants issuing billions in debt to fund AI expansion are pushing global bond yields to multi-decade highs, Reuters correspondent Gregor Stuart Hunter explains

What happened

Rising government deficits, worries about inflation from a Middle East war, and tech giants borrowing heavily to fund AI are together lifting global bond yields to levels not seen in decades.

Confirmed

Global impact / market context

Higher bond yields raise borrowing costs for governments and companies, which can slow growth, shift investment choices, and tighten overall financial conditions for investors.

Analyst inference

Ballooning government deficits, a Middle East conflict driving inflation fears and tech giants issuing billions in debt to fund AI expansion are pushing global bond yields to multi-decade highs.

Confirmed

What to watch

1. Watch for fiscal policy moves aimed at reducing deficits, because smaller deficits could lower borrowing costs and help bring bond yields down. Analyst inference
2. Follow the Middle East conflict and inflation reports, as any escalation may keep investors nervous about price stability and sustain higher yields. Analyst inference
3. Track the amount of AI‑related debt tech companies issue and their repayment plans, since large corporate borrowing can further push yields and widen credit spreads. Analyst inference

Evidence

• x.com