Market gauges of inflation-adjusted borrowing costs, known as real yields, have climbed to their highest in more than a decade across major economies.
Investors and analysts see the rise of new bond issuance by AI "hyperscalers" at a time when governments are still spending heavily as a factor driving up the cost of borrowing for governments, as it demands rates offering higher returns.
In this wake, US 30-year real yields, measured by inflation-linked bonds, are reported near 18-year highs at around 3%, while British and German 10-year real yields trade near their highest levels in more than a decade.
The US paid 5.22% at a 30-year bond auction on Thursday, its highest borrowing cost at such a sale since 2001.
Meanwhile, big tech companies like Alphabet, Amazon and Meta have issued almost $220 billion of bonds so far this year, more than double the $108 billion sold across the whole of 2025.
Inflation expectations have stayed broadly steady even amid the Iran conflict, suggesting the rise in borrowing costs stems more from real yields than from fears of faster price growth.
Eurozone and UK yields added to the move Thursday, climbing alongside US Treasuries as higher oil prices this week stoked fresh inflation concerns.
