Central banks are turning hawkish and long-end bond yields are surging worldwide — and published research this week argues the two forces are feeding each other.
Analysts broadly flag Fed Chair Warsh's Jackson Hole remarks as the trigger for a sharp repricing, with market-implied odds of a September hike now cited around 65–70%. At the same time, one strand of research highlights a synchronised jump in long yields — US 10-year above 4.75%, 30-year near 5.3%, German Bunds at 3.33%, and Japan's 10-year through 3% for the first time since 1996 — driven as much by fiscal deficit worries as by rate expectations.
A third thread points to Middle East energy disruption lifting Brent above $90/bbl, reinforcing inflation risk and central bank hawkishness. Some recently-published views also argue the AI capex boom is structurally lifting the neutral rate, though a contrarian analysis finds little aggregate demand lift in the euro area.
Divergence remains: one camp still sees the Fed on hold through 2026, against a consensus leaning toward a hike. Payrolls Friday is the next big test.