Global bond markets slid again Wednesday, pushing borrowing costs to levels not seen in decades as the Middle East conflict fuels higher energy prices and deepens fears over inflation and ballooning government debt.

Sovereign bond yields are a reference point for asset prices across financial markets, and the higher ⁠price of money means elevated mortgage rates for consumers and tough choices ⁠for government spending as funding costs climb.

The yield on 10-year U.S. Treasuries – which sets the tone for borrowing costs across the world economy – hit a three-year high. It is nearing the 5% level that could unsettle already jittery stock markets.

Japan’s 10-year yield was perched above 3% for the first time ​in 30 years, while rising gas prices meant German 10-year Bund yields were stuck at their highest since 2011 ​and ⁠Britain’s equivalent was at its highest since 2008. Yields rise as prices fall and vice versa.

A confluence of factors was at play, said State Street’s head of macro strategy, Michael Metcalfe, with rising energy prices causing traders to bet on rate hikes, pushing up short-dated yields.

“The narrative is also getting wrapped up with longer-term concerns about the fiscal path. In France and the U.K., we are going to get news on budgets soon. So, there are not many positives out there,” Metcalfe said.

Bond sales from big tech companies aggressively raising money to fund the AI boom have added pressure on the sovereign bond market, as deep-pocketed U.S. tech firms compete with governments for investors’ capital.

Naka Matsuzawa, chief macro strategist at Nomura Securities in Tokyo, said so-called hyperscalers’ willingness to pay reasonably high rates was pulling up yields broadly, with the focus now on whether growth can rise along with them to help economies cope with the higher rates.

Yields can continue to rise as investors demand a higher premium, said Charu Chanana, chief investment strategist at Saxo.

Bond vigilantes assemble?

Bonds have been under pressure since the start of the U.S.-Israeli war on Iran, but yields have hit multi-year highs in recent months on worries about rising debt loads in big economies, including the United States.

Governments are borrowing heavily after a jump in spending during the pandemic and the Ukraine war and energy crisis. They also face ageing populations, rising welfare bills, and higher defence investment needs.

Britain’s new government, led by Prime Minister Andy Burnham, will present a budget in October, while France is gearing up for further battles over its next budget.

And in Japan, the bond yield surge has put the spotlight on Japanese Prime Minister Sanae Takaichi and her aggressive investment plans.

The moves have raised ⁠the specter of “bond vigilantes,” investors who seek to impose fiscal discipline on governments by demanding sharply higher compensation to hold their bonds.

“The fear is that the bond vigilantes are on the loose and driving yields higher in protest over large government deficits,” said Ed Yardeni, president of Yardeni Research.

“We share the bond vigilantes’ concerns, but we aren’t convinced bond yields are, or will soon be, ​prohibitively high,” said Yardeni, who coined the term in the 1980s.

He said that if U.S. 10-year yields hit 5%, he expected Treasury Secretary Scott Bessent to issue ​more shorter-dated debt to buy back longer-dated bonds to calm markets.

The U.S. Treasury stepped into markets last month to cool long-end bond yields, though the impact was short-lived and 30-year Treasury yields are back near 19-year highs.

State Street’s Metcalfe said the sell-off in bonds was “orderly.”

Nick Ferres, chief investment officer ⁠of Vantage Point Asset Management ‌in Singapore, said ‌rates could start to cause pain for public and private borrowers, with higher yields also weighing on stock valuations.

Global ⁠stocks have broadly been supported by strong earnings, although they have weakened this week.

Higher yields can ‌make bonds look more attractive and particularly dent the appeal of companies whose earnings potential lies far in the future, given the better return available on safe assets.

Policy in focus

Rising energy costs continue to dog economies, ​fuelling traders’ rate-hike bets.

Brent crude oil hit a one-month ⁠high Wednesday after the U.S. and Iran traded strikes, while European natural gas prices are at their highest since early ⁠2023.

Federal Reserve (Fed) Chair Kevin Warsh triggered a sharp rise in bets on a September rate hike with a hawkish speech last week in which he acknowledged ⁠there had not been enough progress on inflation.

The ​rate-sensitive two-year Treasury yield is at 18-month highs.

Traders expect a European Central Bank (ECB) rate increase next week and price in about a 70% chance of a Fed hike the week after.

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Uber Technologies announced on Wednesday plans to cut about 3,300 jobs, or roughly 10% of its workforce, in a restructuring it says is aimed at removing management layers, consolidating teams and reducing costs.

The cuts follow ​a difficult year for Uber shares, which have fallen nearly 8% ​and underperformed the broader S&P 500 amid investor concerns that autonomous ⁠ride-hailing companies such as Waymo could threaten Uber’s dominant North American market share.

The company ​had about 34,000 employees globally at the end of last year, according to ​its annual report.

The layoffs would be Uber’s largest since May 2020, when the company cut about 6,700 jobs, or nearly a quarter of its workforce, as pandemic restrictions crushed ​demand for ride-hailing services.

Echoing a broader push across the tech industry to ​stay nimble, CEO Dara Khosrowshahi said the cuts would reduce organizational complexity that had slowed down ‌Uber’s ⁠decision-making and created roles focused on coordination.

But unlike several tech executives, he did not blame the cuts on AI. He also said Uber would combine some teams and concentrate most of its staff presence around key hubs as ​part of the move.

Uber ​said it reduced ⁠the number of employees positioned seven or more reporting layers below the CEO by 20% and cut the number ​of “micro-teams”, teams with only one or two direct reports, ​by nearly ⁠half.

The company will concentrate global teams in New York and San Francisco, require most remote workers to relocate and limit fully remote roles to about 1% of ⁠staff, ​while maintaining its three-day office policy.

Its shares rose ​about 2% in premarket trading following the announcement, which was first reported by Bloomberg News.

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As Taiwan’s stock market soared this year, being one of the best performers in the world, real estate worker Lucas Chen moved to borrow NT$5 million ($157,330) to buy tech shares, and within six months, he says he quadrupled his money.

Chen is one of a growing number of people using debt to buy into the island’s stock market, which soared 59% in the first half of the year thanks to booming demand for artificial intelligence hardware made by chip giant TSMC and others.

But while the prospect of vast returns has lured and repaid many, others have suffered hefty losses or been tricked by scammers, prompting authorities to issue warnings about the risks.

“The first half of the year was really crazy. It was absolutely wild,” said Chen, who makes a base salary of up to NT$50,000 ($1,500) from his job.

The 34-year-old began trading in the stock market 10 years ago, saving up his bonuses to buy chip titan TSMC, which accounted for about 45% of the Taiwan Stock Exchange at the end of 2025.

At the start of this year, Chen saw “a good opportunity” to increase his investments and took out three bank loans worth NT$5 million, using his new Tesla as collateral for two of them.

The bet paid off.

Chen’s tech investments, half of them in TSMC, surged nearly 70%, pumping up his holdings by about NT$20 million by late June.

“The older generation would say borrowing money isn’t a good thing,” Chen told Agence France-Presse (AFP).

“But if you do the maths carefully,” the risks are “controllable.”

Financial influencer Yeh Yu-shuo has enjoyed the fruits of the market, but he has also seen the downside of the stock-buying frenzy in his Facebook group, where hundreds of thousands of members can trade investment advice.

“I’ve reviewed posts saying they want to jump off a building,” Yeh said.

One anonymous poster said in early August he had invested NT$10 million, including a NT$6 million mortgage, in recent months and had lost nearly half of it.

“Since last month, I’ve been waking up in the middle of the night in a panic,” the poster said.

“I’ve already sought treatment from a psychiatrist, and I even went to Zinan Temple, but none of it has helped at all. Right now, all I want is to get my money back as quickly as possible.”

‘Buying stocks like crazy’

Global stock markets have surged this year to all-time highs as tech firms ramped up spending on AI data centers, hardware and software.

However, the rally hit a wall in July, hammering the tech sector on concerns over when that cash will see a return, and warnings that company valuations had gone too far.

Anticipation for a U.S. interest rate hike has also weighed on sentiment and could curb demand for stocks, particularly tech firms, which rely on borrowing to fuel their investments.

While some people in Taiwan have used their savings or borrowed from family to invest, many have relied on banks or brokers to fund their stock purchases.

Norman Yin, a professor of money and banking at National Chengchi University, said young people have been “buying stocks like crazy.”

Taiwanese banks are sitting on “unprecedented” levels of deposits, partly due to stagnant property prices, and are very willing to lend.

“If I borrow money from a bank to buy stocks, I could make more in one day than I earn from my salary in a month,” Yin said, noting fresh graduates often made around NT$40,000 per month.

“It’s faster and easier than sitting in an office and working hard.”

Meanwhile, margin trading – in which investors use funds borrowed from a broker to buy securities – rose nearly 20% in the first half from the previous six months, Taiwan Stock Exchange data show.

Taiwan’s Financial Supervisory Commission told AFP that overall “credit risk remains under control.”

Still, the stock exchange has started publishing videos on social media warning young investors about the risks of defaulting on their loans.

‘Windfall for our generation’

Social media platforms in Taiwan are rife with posts about people making huge sums and quitting their jobs to trade full time.

Marketing specialist Jerry Lee, 30, said he has watched with some envy as friends post about their gains in their group chat.

“When you see someone make two or three months’ salary in two days, oof, that’s really painful,” said Lee, who describes himself as a “conservative” investor.

Social media gives the impression that “everyone is making money” he said.

“When it’s dropping, they won’t tell you about it.”

Taiwan’s stock index fell about 16% from its record high on June 22 to July 30, while South Korea’s market – which has been the poster child of the global tech-led surge this year – plunged about 40%.

Still, Yeh said he had confidence in Taiwan’s stock market “as long as TSMC remains stable.”

The Taiex has recovered almost all the losses sustained in the summer sell-off.

Chen said the opportunity to make money would keep him investing.

“This is a windfall for our generation,” he said.

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Russia sees no grounds for the Black Sea grain deal ​to resume, Deputy Foreign Minister Alexander Grushko said Wednesday, as Russia and Ukraine ⁠continue to attack each other’s ⁠export facilities.

Türkiye and the United Nations helped mediate the so-called Black Sea Grain Initiative, which was agreed ​in July 2022 to allow the safe ​export ⁠of nearly 33 million metric tons of Ukrainian grain via the Black Sea, despite the war.

Russia withdrew from the agreement in 2023, complaining that its own food and fertiliser exports faced serious obstacles.

Türkiye has prepared a new plan for the safe passage of grain via the Black Sea and was contacting both countries in this regard.

“There was a deal … But a substantial part of it was ⁠not implemented. ⁠Do you see any change in the West’s position? I don’t,” Grushko told reporters on the sidelines of a forum in the Russian Far East port city of Vladivostok.

Both Russia and Ukraine are major grain exporters and their mutual attacks, in the wake of the Russian invasion of Ukraine in February 2022, have contributed to the increase ⁠in global wheat prices.

Russia continues to attack Ukraine’s Black Sea export facilities and those along the Danube River, damaging infrastructure and injuring three in Odesa, ​Ukraine’s largest seaport, in a fresh strike Wednesday, a city ​official said.

Tensions with Germany

The German government said Tuesday that it had concluded that Russia was responsible ⁠for ‌an attempted ‌drone attack at Leipzig/Halle Airport last month and ⁠ordered a series of measures in ‌response, including a consulate closure in Bonn.

Russian President Vladimir Putin the ​same day accused Germany of ⁠planting the evidence in order to blame ⁠Moscow for the incident.

Grushko said on Wednesday Russia will ⁠retaliate to the ​Bonn consulate closure “very soon.”

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Türkiye’s manufacturing activity rose to a three-month high in August, a survey showed Tuesday, signaling a modest improvement in business conditions even as the sector remained in contraction.

The Istanbul Chamber of Industry (ISO) Türkiye Manufacturing Purchasing Managers’ Index (PMI), compiled by S&P Global, rose to 48.1 in August from 47.7 in July. A reading below 50 indicates contraction, while one above 50 signals growth.

Surveyed businesses said the war in the Middle East continued to weigh on the manufacturing sector midway through the third quarter, mainly through subdued demand and heightened market uncertainty.

Both total new orders and new export business declined in August, although the contractions were less pronounced than in July.

Manufacturers also cut production for a third consecutive month. The latest decline was modest and broadly in line with the pace recorded in July.

With workloads remaining subdued, manufacturers reduced employment and purchasing activity at solid rates, with both declines accelerating from the previous month.

Firms also drew down existing inventories to meet order requirements where possible, leading to further reductions in stocks of both purchases and finished goods.

Meanwhile, input cost inflation accelerated to a three-month high amid reports of higher fuel and oil costs as well as rising raw material prices. Manufacturers responded by raising their selling prices.

Output price inflation also accelerated, although it remained below its average for the first half of the year.

Supplier delivery times lengthened as disruptions linked to the Middle East conflict affected supply chains, the survey showed.

Andrew Harker, economics director at S&P Global Market Intelligence, said the war in the Middle East continues to cast a shadow over the manufacturing sector, limiting demand and adding a layer of uncertainty to business decisions.

“Despite this, firms have been able to limit the impact, with new orders easing to the smallest degree in three months during August,” Harker said.

“This provides some hope that the sector can move up a gear in the months ahead, but much still depends on events in the Middle East and how they play out,” he added.

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Türkiye will seek to deliver a historic action plan with concrete solutions to the climate crisis at the COP31 it will host in November, Environment, Urbanisation and Climate Change Minister Murat Kurum said Tuesday.

“Do not expect a piece of paper from Antalya that will gather dust on shelves,” Kurum, who is also president of this year’s U.N. climate summit, told an event in the capital Ankara. “We will produce a strong action plan that will shake the world to its foundations and rewrite history.”

The annual COP conference is the main global forum for driving action on climate change. The long-established consensus ​among the world’s scientists is that climate change is real, mostly caused by humans, and getting worse. Its main cause is greenhouse ​gas emissions from burning fossil fuels like coal, oil and gas, which trap heat in the atmosphere.

Kurum said this year’s summit in the southern Mediterranean province will be “the COP of implementation” focused on turning climate commitments into tangible action rather than setting new targets.

“The world does not need to constantly set new targets at the negotiating table. What it needs is an unwavering will to turn those targets into action in the field, in industry and in cities,” the minister noted.

“Let Antalya not be a place where problems are discussed over and over again, but rather a place where solutions are found.”

Kurum said Türkiye would use its diplomatic capacity and experience to overcome barriers to implementation and ensure that commitments made under the Paris Agreement translate into concrete results.

6 global initiatives by 2035

Under a format agreed last year, Türkiye will host the summit and hold its presidency, while Australia will lead the negotiation process.

Kurum said the two countries have set six major global initiatives to be implemented by 2035.

The first focuses on electrification, with a goal of increasing its global share to 35%.

The second aims to cut the growth in global waste by half, while the third targets a 25% reduction in energy consumption in buildings by 2035.

The fourth initiative seeks to increase the use of circular materials in industry to 15%, reducing pressure on natural resources.

The fifth focuses on climate literacy and education, while the sixth aims to establish a “Climate Implementation Bridge” connecting countries in need with financing and solutions.

Kurum said governments alone could not finance the scale of investment required to tackle climate change and called on banks, investors and major companies to play a greater role in the green transition.

“This historic crisis cannot be overcome with the limited budgets of governments alone,” he said, urging the private sector to join the effort at the center of the green transformation.

Stronger role for vulnerable countries

Kurum said Türkiye would seek to ensure that vulnerable countries, particularly those in Africa and small island states, have a stronger voice in the COP31 process.

He said climate impacts did not respect national borders and that climate justice would remain Türkiye’s guiding principle during the negotiations.

Türkiye is working with Australia around three pillars, dialogue, consensus and action, and plans to engage with countries and stakeholders ahead of the Antalya summit, he said.

Kurum said Türkiye would also use the process to bring together young people, cities, businesses, farmers and scientists to develop practical solutions.

He said the world leaders summit in Antalya would provide an opportunity to give new direction to international climate efforts.

Kurum said Türkiye would continue preparations through a series of international meetings and initiatives, including events in Fiji, Baku, New York and London.

He said the Pre-COP meeting in Fiji would be particularly important for giving vulnerable Pacific island states a platform to make their concerns heard.

“We will start with dialogue, grow through consensus and bring it to life through action,” Kurum said.

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