Portuguese public debt interest rates at 20 years reached their highest value since 2017 this Tuesday, rising more than three basis points to 4.2623%. This rise occurs in a context of strong selling pressure in bond markets worldwide, with investors fearing further interest rate hikes by central banks to control inflation.
The rises in other Eurozone countries were even more intense. In France, interest rates advanced 3.2 basis points to 4.7395%, the highest rate since 2008, while in Italy they rose more than four basis points to 4.779%, trading at highs since 2023. In Germany, 20-year interest rates rose 2.5 basis points to 3.7694%, also the highest value since 2008. In Japan, 10-year interest rates reached 3%, the highest in 30 years. The basis for this pressure is linked to the new escalation of the conflict in the Middle East, which is causing investors to adjust their expectations regarding further interest rate hikes.
Eric Robertsen, chief strategist at Standard Chartered, stated that all countries are increasing their borrowing at a time when financing costs are rising, considering that the fiscal situation is not improving anywhere. Eurostat revealed that inflation in the Eurozone accelerated to 3.3% in August, compared to 2.9% recorded the previous month, with energy driving prices in the region.
The European Central Bank has a meeting scheduled for September 10, where it is expected to announce a new interest rate hike of 25 basis points for the Eurozone, after the increase already announced in June. Analysts also anticipate another rise in December.
