Global bond rout deepens as Japan’s yield hits 3% milestone

The last time Japan’s 10-year government bond yield sat at 3%, Bill Clinton was in his first term and the word “internet” was still explained in parentheses in newspaper articles. That era ended on September 1, 2026, when the benchmark Japanese Government Bond yield briefly touched 3% intraday before settling just below it. A synchronized global meltdown in bond prices US 10-year Treasury yields climbed to approximately 4.79%, sitting near multi-year highs. German 10-year bunds reached roughly 3.35%, also at levels not seen in years. The Bloomberg gauge tracking global government bond yields hit 3.72%, its highest reading since mid-2008. Brent crude oil surpassed $91 per barrel, fueled in part by rising tensions in the US-Iran conflict. Eurozone inflation remained above 3%, keeping the European Central Bank in an uncomfortable position heading into autumn. In Japan specifically, the 5-year JGB yield climbed to a record 2.26%. The 2-year yield hit 1.795%, a 31-year peak. Japan’s budget requests for fiscal 2027 reached a record ¥143 trillion, roughly $890 billion. Japan’s debt-to-GDP ratio already hovers near 250%. Higher yields mean higher debt-servicing costs, which means the budge...