Global bond selloff weighs on markets as oil surges past US$91

A significant selloff in global bond markets is dampening investor sentiment, with the 10-year US Treasury yield climbing to its highest level in nearly 20 months. The broader shift in fixed-income valuations reflects investor concerns about persistent inflation and monetary policy tightening, sending ripples through equity markets in South and Southeast Asia.

Japan's 10-year government bond yield has approached 3%, reaching levels unseen for roughly a generation. This represents a dramatic shift for the world's second-largest economy, which has maintained ultra-low interest rates for decades. The move signals a potential repricing of global risk assets and expectations for divergent policy paths between major central banks.

Commodity markets have similarly felt the pressure, with crude oil climbing past US$91 per barrel. Energy-sensitive stocks and currencies across the region face headwinds as the bond market volatility creates uncertainty about economic growth prospects. The surge in borrowing costs threatens to weigh on corporate earnings and capital investment plans.

The synchronized moves across US Treasuries, Japanese government bonds, and crude oil prices underscore growing concerns about the trajectory of global economic growth. Investors are reassessing portfolios amid expectations that interest rates may remain elevated for longer than previously anticipated, a shift that threatens to extend the period of financial market volatility.