Indebted Governments Are Fueling the Global Bond Selloff

Oil prices are pushing interest rates higher. But rising government debt is the bigger risk. Across the world, bond markets are selling off. Prices are falling, and yields — the interest rate investors earn from a bond — are climbing. Oil is one driver. Higher oil prices feed inflation, and inflation pushes rates up. But debt is the deeper problem. Many governments now carry heavy borrowing loads. Investors worry these countries may struggle to repay, so they demand higher returns to hold their bonds. That combination — expensive oil and stretched government finances — is adding fuel to the selloff.