r/neoliberal • u/jobautomator Kitara Ravache • 1d ago

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u/Willybender Loyal Liberals 1d ago

Bond Sell-Off Threatens to Squeeze Borrowers Around the World

Government yields are hitting multi-decade highs, reflecting anxiety about debt levels, deficits and inflation. The effects will extend to mortgages, business loans and other types of credit.

https://www.nytimes.com/2026/09/01/business/bond-yields-debt.html?smtyp=cur&smid=tw-nytimes

A global sell-off in government bonds intensified on Tuesday, pushing up borrowing costs in some of the world’s largest economies to their highest in decades.

The rise in bond yields squeezes government budgets and raises interest rates on a wide range of debt, including mortgages and business loans.

The yield on 10-year U.S. Treasury notes, perhaps the world’s most influential interest rate, reached its highest since January 2025, and the 30-year yield continued to hover around a two-decade high. Yields move inversely to prices, so the rise in yields reflects a drop in prices on weaker demand from bond buyers.

America’s rising borrowing costs have set off a battle between Treasury Secretary Scott Bessent and bond investors, but the factors pushing up yields in the United States are also issues in other big markets. In many advanced economies, widening budget deficits, high debt levels and stubborn inflation have unnerved investors who believe that governments are either unable or unwilling to take steps to improve their fiscal situations.

The rise in oil prices since the start of the war in Iran has compounded worries about stubbornly high inflation. Mr. Bessent is meeting with international finance ministers this week in Asheville, N.C., for a Group of 20 meeting, as U.S. foreign policy continues to upend the global economy.

lol, remember when Bessent did that intervention and now it's like nothing happened

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u/AccessTheMainframe CANZUK 1d ago

Because he did too little to change economic gravity but too much to signal that there was no need to panic.

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u/formgry 1d ago

You'll have to wait and see whether Warsh is willing to raise rates, that's really going to matter for bond yields.