Bond strategists warn that yields will remain high even after the Iran war ends.

On May 24th, Jinshi reported that while concerns about war-induced inflation persist, other factors are also influencing long-term borrowing costs. In the United States, the "real yield," adjusted for inflation, has a greater impact, suggesting that bond investors are worried about more than just price pressures from the war in Iran. Other contributing factors include: the potential for further expansion of the already massive public debt burden, the impact of the artificial intelligence investment boom, and the increasing likelihood of interest rate hikes rather than cuts by central banks such as the Federal Reserve. Strategists at ING, Goldman Sachs, and Barclays have all emphasized that a common assumption is that the recent rise in some long-term yields will not be fully reversed even if inflation triggered by rising oil prices subsides. This means that even after the conflict ends, market borrowing costs may remain near multi-year highs, continuing to put pressure on governments and the economy.