Belgium’s 10-year government bond yield rose above 4.25% shortly before noon on Thursday, its highest level since 2011.
The increase comes amid a sustained sell-off in bond markets, which is pushing borrowing costs higher.
Investors are concerned that inflation could rise again following the escalation of the war in the Middle East and a sharp increase in oil prices. This could force central banks to keep raising interest rates.
Norway’s central bank did so on Thursday.
As interest rates climb, existing bonds become less attractive, and investors are less willing to tie up their money for long periods.
Higher long-term rates are bad news for the State of Belgium, as borrowing on the financial markets becomes more expensive.
The 10-year yield also influences mortgage rates, raising the risk of further increases in the cost of home loans.
Long-term borrowing costs are continuing to rise in other European countries and beyond.
Germany’s 10-year yield, the main benchmark in Europe, has reached its highest level since 2009, while the US 30-year yield is at its highest since 2004.
In Japan, the 10-year yield has climbed to its highest level since 1996.
According to Bloomberg calculations, the average yield on government bonds is now just below 4%, its highest level since 2007.
