Rising Real Yields Pose Risks to Stocks and Global Growth

What happened

Inflation-adjusted borrowing costs have reached decade highs, driven by heavy government and tech bond issuance. US 30-year real yields hover near 18-year highs at 3%, while tech giants issued nearly $220 billion in bonds this year, more than double 2025's total. The US Treasury paid 5.22% on a 30-year bond auction, the highest since 2001.

Why it matters

Higher real yields make bonds more attractive than equities and reduce the present value of future cash flows, potentially pressuring stock valuations. While equities remain resilient, sustained higher borrowing costs could slow economic growth and constrain the debt-fueled equity rally.