Investors in every major economy face a brutal repricing of money as the global bond rout accelerates, warns the CEO of deVere Group, one of the world’s largest independent financial advisory organisations as the global bond sell-off deepens with oil climbing.
The comments from Nigel Green come as Brent crude surges back above $105 a barrel and the 10 year US Treasury yield climbs to 5.15%, its highest since 2007, dragging bond markets across Asia, Europe and the Pacific down with it.
He says: “This is a synchronised global repricing of borrowing costs, and it’s gathering speed.
“Oil’s above $105, the US economy’s running hot and central banks are tightening again. Every major bond market’s feeling the heat at once.”
The damage is spreading fast. Japan’s 10 year yield has hit 3.08%, its highest since 1996. UK 10 year gilts touched 5.39% and German Bund yields reached 3.58%. Australian 10 year yields have climbed to levels last seen in 2011, while French borrowing costs this month hit their highest since 2008.
The deVere CEO comments: “There’s nowhere to hide in sovereign debt right now.
“Europe, Asia and the US are being repriced together, so investors can’t simply rotate between regions for shelter.
“When correlations snap together like this, diversification within bonds alone won’t protect a portfolio.”
In the US, traders now see a better than 75% chance of another Federal Reserve hike in October, up from around 49% a week ago and under 10% a month ago. The Fed lifted rates to 3.75% to 4% last week, its first hike in three years, with 16 of 18 officials projecting at least one more move this year.
Pressure is building elsewhere too. Markets are pricing an 85% chance of a Reserve Bank of Australia hike on 29 September, and the Bank of Japan has already tightened.
“An energy supply shock landing on overheating economies is the combination central bankers fear most. It forces their hand everywhere at once. Anyone positioned for a global easing cycle has had the ground pulled from under them,” explains Nigel Green.
Fresh US data added fuel. Business activity is expanding at its fastest pace in more than five years, input costs are climbing at the steepest rate in four years, and manufacturing readings hit 57 against expectations of 53.6.
Appetite for debt is thinning too. A five year Treasury auction this week cleared at 5.033%, well above the recent 4.186% average, with indirect bidders, a group including foreign central banks, taking just 54% versus a typical 65%.
He says: “Weak auctions are the warning light to watch. Supply’s exploding just as buyers step back, and the imbalance only resolves one way: higher yields.”
Supply is surging on every front. US national debt topped $40 trillion in August, governments worldwide are running large deficits, and US companies had issued almost $1.7 trillion of bonds by August, up 27%, much of it funding the AI buildout. The OECD warns surging yields are a major concern for public finances.
Nigel Green says: “Governments borrow more, yields rise, interest bills swell and they borrow again. It’s a vicious circle, and political uncertainty keeps tightening it.”
The fallout is reaching households and equities. The average US 30 year fixed mortgage rate has jumped to 7.26%, the highest since January 2025, while Wall Street futures fell 0.7% on Thursday and tech futures dropped 1.2%.
He says: “Once risk free rates sit above 5% in the world’s largest economy, every asset on the planet has to justify its price against that. Equities, property, private credit, emerging market debt. Nothing’s immune.”
He concludes: “This is the moment for investors to review their exposure, broaden diversification across assets, regions and currencies, and make sure they’re not caught leaning the wrong way.
“The world’s bond markets are screaming, and ignoring it could prove very expensive.”
