Why are global 30-year yields still so high today? Japan’s record JGB, UK gilts near 27-year peaks, and what it means for growth

If you’re searching “why are global long-term bond yields rising September 2025”, the short take is term premium + fiscal worries. Even after a brief respite, 30-year benchmarks in several major economies are parked near cycle extremes: Japan’s 30-year JGB set a record high, UK 30-year gilts hold around their highest since 1998, and core Europe remains elevated. That cluster of moves says investors want more compensation to hold duration when inflation progress is uneven and public borrowing needs are heavy.
What’s driving it:
Debt math meets credibility: Larger deficits and refinancing at higher coupons keep debt-service costs climbing, raising the bar for credible fiscal anchors. Markets price a fatter term premium when they doubt medium-term discipline.
Patchy disinflation: Headline inflation has cooled, but monthly producer-price noise (energy) and services resilience keep longer-run inflation uncertainty from collapsing.
Less Japanese bid: With JGB 30-year yields at records, local savers have less reason to reach abroad for income, removing a tailwind that used to support overseas long bonds.
Markets’ telltales:
Gold at a record above $3,540/oz signals a safety bid as duration gets volatile.
U.S. long bonds briefly tested 5% on the 30-year before easing; Europe’s stocks tried to stabilize, while parts of Asia lagged.
FX was mixed, with sterling wobbling and the yen only slightly weaker despite higher local yields—evidence that rate differentials and risk tone are pulling in opposite directions.
How to read today’s international data:
Eurozone PPI (July): +0.4% m/m, +0.2% y/y—energy up on the month, but core industrial prices remain tame.
China services PMI (Aug): expansion in the low-mid 50s, keeping a floor under regional growth even as factories struggle. Together, those prints explain why markets aren’t rushing to price ultra-low long-run inflation.
Who’s most exposed: Long-duration equities, commercial real estate, and projects with payoffs far in the future feel the sting of higher discount rates. Sovereigns with large gross financing needs face a tougher issuance backdrop. Conversely, banks’ asset yields reset higher, and savers get better long-term deposit alternatives—especially in Japan.