As an important "pricing anchor" of global assets, the yield of 30-year US treasury bond bonds has remained high recently.

On August 18, the yield of 30-year US treasury bond bonds once rose to 5.34%, the highest since 2008; On August 27th, it slightly fell back to 5.18%. Since 2026, the yield of 10-year US treasury bond bonds has continued to rise, with a cumulative increase of about 53bp (basis points) year to date.

In addition, the yield of UK 30-year treasury bond was once close to 5.86%, approaching the high since 1998, the yield of Japanese 30-year treasury bond exceeded 4%, and the yield of German 10-year treasury bond rose to about 3.26%, breaking the high since 2011.

It is worth noting that the statistical data of Cathay Pacific Haitong Research Report shows that since 2007, the 30-year US treasury bond has only stood at 5% four times. The first three triggers were mostly related to supply shocks and policy reputation, and finally ended in policy shifts or risk aversion events. But this time, in addition to factors such as high fiscal deficits and the resumption of geopolitical conflicts, the huge financing needs of AI (artificial intelligence) technology giants have joined the battle. This has never happened in the past few crises.

Liu Chenming, Chief Strategy Analyst of Guangfa Securities, believes that the main reasons for the global long-term bond interest rate hike this round are the re heating of oil prices and inflation risks, the expansion of government bond supply, the continuous withdrawal of the central bank from the bond market, and the joint push of large-scale financing by AI companies to increase term premiums.

Brian Coulton, chief economist of Fitch Ratings, believes that there may be two factors behind the rise in the yield of long-term US treasury bond bonds. Firstly, the market has increased uncertainty about the policy outlook of the Federal Reserve under the leadership of Kevin Warsh. Nowadays, the Federal Reserve almost no longer provides much forward guidance, and Walsh has mentioned that it is necessary to restore the credibility of the Fed after several consecutive years of inflation exceeding the target. This is likely to mean that the Federal Reserve's real interest rates will remain at a relatively high level for a considerable period of time, although this is currently not very clear. The yield of long-term treasury bond must compensate investors for the risk they take due to holding long-term interest rate positions (relative to holding short-term positions and extending them) - as the uncertainty of the medium-term treasury bond interest rate prospect increases, this term premium has been rising.

Secondly, a noticeable change in the past few months has been a significant increase in the issuance of US corporate bonds, as companies have started borrowing for IT capital expenditures. Until recently, this wave of IT capital expenditure was mainly supported by retained earnings and cash. But now companies are starting to enter the market to raise funds. This means that the government is facing more competition in the financing market as it continues to maintain a large fiscal deficit. ”Brian Coulton said.

US treasury bond soared to over 40 trillion US dollars

On August 18th local time, the US Treasury Department released data showing that the total federal debt of the United States exceeded $40 trillion for the first time in history, and the US fiscal deficit in July was $432.3 billion. The next day, the US Treasury Department announced that from September 9, 2026, the maximum size of a single time for liquidity supported repo of long-term treasury bond will be raised from US $2 billion to "at least US $4 billion", which is aimed at stabilizing the price of treasury bond and the treasury bond market.

On August 20th, two Federal Reserve officials publicly emphasized that the Fed independently formulates monetary policy and is not influenced by debt management or fiscal policy. St. Louis Federal Reserve President Mussalem stated that the current financial environment remains loose and is inclined to support interest rate hikes at the September monetary policy meeting.

Then on August 24, the US Treasury Department released a signal again after further upward pressure on long-term US treasury bond bond interest rates: two senior Treasury officials said that the Treasury Department could use its nearly $1 trillion TGA account (Treasury General Account) to help its recently announced plan to increase government bond purchases.

The chief economist of CITIC Securities clearly believes that in the short term, the yield of long-term US treasury bond bonds is expected to remain high. Although the determination of the Ministry of Finance to protect the market has reduced the risk of the long-term US treasury bond bond interest rate breaking through the previous high, the current US fiscal pressure, the increase in corporate bond supply, the uncertainty of the Federal Reserve's monetary policy and geographical risks are expected to support the long-term US treasury bond bond interest rate to continue to operate at a high level in the short term. The intensification of the Middle East conflict, the rise of crude oil prices, the increase of the monthly deficit gap of the Ministry of Finance and the increase of the net financing scale, the improvement of key indicators of the US economy beyond expectations, and the more hawkish statement of the Federal Reserve may all constitute upward pressure on the long-term US treasury bond bond interest rate, otherwise the pressure on the US treasury bond bond interest rate will be eased.

AI corporate bonds and US treasury bond bonds?

Another voice believes that the large-scale capital expenditure of American AI large factories has maintained a high growth, which translates into large-scale long-term financing demand and crowding out effect on long-term US treasury bond bonds.

In this round of AI expansion cycle, the top AI technology giants in the United States continue to increase capital expenditures and issue bonds. The technology giants that used to be suppliers of market funds have now transformed into demanders of funds. According to data from the London Stock Exchange Group, tech giants including Alphabet, Amazon, and Meta have issued nearly $220 billion in bonds since 2026, far exceeding the annual bond issuance scale of approximately $108 billion in 2025.

At the same time, Nvidia and Broadcom are collaborating with private equity lending institutions and asset management companies to build financing platforms, providing financial support for customers to purchase chips, deploy servers, and build data centers. Artificial intelligence financing has gradually extended from direct bond issuance by enterprises to fields such as private equity credit, equipment leasing, and project financing. Morgan Stanley predicts that the global AI related debt issuance scale may approach $570 billion by 2026.

In August, Google's parent company Alphabet was preparing to issue its first Australian dollar bond since going public, with plans to issue 3-year, 5-year, 10-year, and 20-year varieties. Previously, Alphabet had entered the bond markets of the US dollar, euro, pound, Swiss franc, Canadian dollar, and Japanese yen, with a total of $25 billion in US dollar bond issuances completed in early August.

Alphabet is not an isolated case. Goldman Sachs predicts that the bond issuance scale of five large-scale computing power companies, including Microsoft, may reach $250 billion in 2026 and further rise to $400 billion in 2027.

China Merchants Securities Research News pointed out that under the background of stable total amount of long-term allocation funds such as insurance and pension funds, AI giants issued bonds to divert market funds, squeeze out the allocation demand of US treasury bond bonds, and raise the interest rate and term premium of long-term US treasury bond bonds. Whether this pressure can be alleviated in the future largely depends on the speed at which AI investment can be transformed into stable income and free cash flow. If the profitability of related enterprises continues to grow and the internal cash flow coverage of capital expenditures improves, their debt financing demand and the resulting duration supply are expected to gradually decline; However, in the stage where profit realization is not yet sufficient, AI construction may still become a structural disturbance to long-term interest rates.

Geometric impact of major asset classes

As the "long-term anchor" of global asset pricing, what kind of pricing impact will 30-year US treasury bond have on global stocks, gold, bulk commodities and non US currencies after its yield breaks the new high since 2007?

At the end of June this year, the international gold price briefly fell below the $4000/ounce mark; From July to August, the gold price rebounded and successively reached two levels of $4200/ounce and $4300/ounce, and has now returned to around $4600/ounce.

West China Securities believes that if the U.S. treasury bond bond problem continues to ferment and the yield continues to rise, then the most beneficial asset may be gold. Because when the market continues to worry about the risk of US debt, selling US treasury bond bonds is often accompanied by selling US dollars, risk aversion will rise and gold will benefit relatively. In terms of suppressed assets, US treasury bond bonds bear the brunt, and assets such as US dollars and US stocks will also bear greater pressure.

Of course, if the problem of US treasury bond bonds is solved and the yield declines, the pressure on related assets will be eased.

Brian Coulton said that the yield of 10-year US treasury bond bonds is actually a more important global benchmark, and it is also rising. This will raise the global cost of US dollar credit, as the US dollar still dominates the global credit system.

Chen Xing, Chief Macro Analyst at Caitong Securities, said that from the perspective of the domestic stock market, Hong Kong stocks are likely to continue to be under pressure. On the one hand, the higher yield of US treasury bond bonds raises the return on US dollar assets, increases the pressure on Hong Kong dollar depreciation under the linked exchange rate system, and suppresses the valuation level of Hong Kong stocks; On the other hand, the repair of domestic demand was not as strong as expected, and the profit repair of Hong Kong stock weighted sectors was weak. The profit of leading Internet enterprises was squeezed by the increase of AI investment, and there was pressure on performance delivery.

Regarding A-shares, Chen Xing believes that since 2025, the upward trend of A-shares has been mainly driven by the appreciation of the Chinese yuan, and the core incremental funds come from the expansion of domestic liquidity brought about by the strong willingness of enterprises to settle foreign exchange, weakening the dependence of A-shares on overseas capital flows. In this context, the impact of the rising yield of US treasury bond bonds on the overall A-share market is relatively limited. However, in the short term, the rise in the interest rate of US treasury bond will directly constrain the valuation of forward cash flow.

(Author Cai Yuekun)