Long-Term Bond Yields Soar Globally on Fiscal Policy Fears

From the US to Japan, long-term borrowing costs for the world’s biggest economies have surged as investors question the ability of governments to cover massive budget deficits.

Thirty-year bond yields this week reached a peak of 5.15% in the US, approaching levels last seen in 2007 before tempering slightly. Those in Japan exceeded the highest on record in data since 1999, with auctions in both countries drawing tepid demand. Long-dated bonds in the UK, Germany and Australia also faced selling pressure.

Investors are warning that governments can’t keep borrowing at the pace they did when interest rates were close ...