IMF warns bond yields could see a 'disorderly' spike as debt, inflation risks worsen

BANGKOK – The International Monetary Fund warned Tuesday that government bond yields could rise in a disorderly fashion, as rising inflation, mounting debt and AI-related borrowings pressure sovereign bond markets. Government bond yields in several advanced economies have climbed to multidecade highs, driven by higher energy costs due to the Middle East conflict and expectations for tighter monetary conditions as central banks look to curb resurgent inflation. In its latest Global Financial Stability Report, the fund warned that sovereign bond risk could deteriorate, warning of "a sharp rise in sovereign bond yields.