The global bond sell-off took a breather on Monday. The benchmark 10-year US Treasury yield eased to 5.2643 per cent, while the two-year stood at 4.8143 per cent.

The pause follows a violent week. The 10-year yield hit 5.34 per cent on Thursday, its highest since 2002. Softer US jobs data cooled bets on further Federal Reserve rate hikes.

But yields remain near multi-decade highs across major economies. Bond prices are under pressure from worsening government finances, heavy bond issuance and elevated energy costs.

Europe is feeling the strain too. The 10-year German Bund yield is near 3.633 per cent, its highest since 2009. The gap between French and German bonds has widened to 132 basis points, a 14-year high, as investors worry about France’s budget.

Standard Chartered strategist Cedric Lam said forced selling by hedge funds may be temporarily delaying a fall in yields. His team has turned tactically bullish on US 10-year bonds.

High yields raise borrowing costs for companies, home buyers and governments alike.