Government bond yields continue to climb unabated even as there have been no obvious recent triggers. 30Y UST yields have climbed to 5.19%, surpassing the peak seen in the last tightening cycle (5.11% in 2023). Current levels were last seen in 2007, reflecting a massive unwind of the low rates era in the post 2008/09 GFC world. Similar dynamics are being priced across the DM space as investors grow increasingly wary of duration risks. There are a few observations from the bond rout. First, oil is no longer the dominant factor driving yields. Despite no breakthrough in US-Iran talks, yields have continued to push higher even as oil prices (Brent at USD 110/bbl) are meaningfully lower than the recent peak. Second, the rates space is recognising that inflation may be sticky and further hawkish rhetoric may be at hand. This point is especially pertinent as economic indicators (excluding China) point to resilience. Rate hikes (currently confined to the BOJ, RBA, Norges Bank) may well broaden out in the coming months. Third, longer-term implied real rates are also rising. Economic optimism could be one key reason. Another factor to consider would be sizable capex requirements in the private sector space that could be competing for attention with govvies. In any case, the bias to global yields remain to the upside in the immediate term. 
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