IMF Warns of Global Bond Market Risks: Sovereign Debt and AI Financing Squeeze Markets

English summary

The IMF warned in its Global Financial Stability Report that government bond yields face the risk of disorderly spikes due to inflation, high debt, and massive AI financing demands. The report noted that hyperscale data center operators' share in investment-grade bond issuance rose from less than 1% to 10%, and highlighted circular financing risks involving $300 billion in equity and $650 billion in debt among AI firms, which could trigger systemic financial instability.