Government borrowing costs are jumping across the rich world, which is bad for homebuyers, small businesses, and heavily indebted governments — and good for big companies that can still borrow cheaply.

• US 10-year government bond yields are pushing toward 5%, the highest since early 2025, and 7% mortgages are back.
• The Treasury tried to talk the market down and was ignored; markets now expect a rate hike rather than a cut.
• It's global — Japanese, British, German, and French yields are all at highs not seen in a decade or more, with France now borrowing more expensively than Italy.
• Causes stack up: inflation, the Iran war lifting oil, huge government debt, and the AI buildout soaking up cash that used to go into bonds.
• Corporate profits are still strong, partly because companies are getting tariff refund checks they aren't passing on to shoppers, while consumer confidence keeps falling.

Outlook: Expect more attempts to calm the bond market, but with inflation still rising, high borrowing costs are likely to squeeze households and small businesses into the holiday season.