U.S. Treasury yields steadied on Monday after a sharp rally last week, with the 10‑year note holding at 4.595%, its highest level in 15 months. The 30‑year Treasury slipped slightly to 5.125% after reaching a near‑year‑high, while the 2‑year note fell to 4.071%, reflecting short‑term rate expectations.

The recent spike in yields was driven by heightened concerns over U.S.–Iran tensions, persistent inflation pressures and rising oil prices. New data showing that price increases are beginning to affect consumers added to the nervousness in bond markets. Treasury Secretary Scott Bessent joined G7 finance leaders and central bankers in Paris, where discussions focused on the impact of inflation and sovereign debt on global markets.

Europe saw similar movements: Germany’s 10‑year bund climbed to its highest since May 2011, and the United Kingdom’s 10‑year gilt reached a peak not seen since July 2008, with the 30‑year gilt also hitting its highest level since 1998. In Asia, Japan’s 10‑year JGB rose to its highest since 1997, while its 30‑year yield set an all‑time record dating back to 1999. These broad increases underscore the stress on sovereign debt markets worldwide.

Analysts warn that central banks now face a delicate balancing act as they navigate inflationary pressures without triggering further market volatility. Oil prices remained elevated, with Brent crude trading around $111 per barrel and U.S. WTI near $107, keeping inflationary inputs high and adding to the challenges confronting policymakers.