Finance, in brief

The interest the US government pays to borrow for 30 years touched 5.5016% this week, its highest since 2004. [2]

A bond's yield is the yearly interest a buyer earns, and it rises when the bond's price falls. So a higher yield means investors were selling. [3]

The 10-year yield, the rate that most US loans are priced from, jumped 20 hundredths of a point in two days to 5.2251%. [2] That was its fastest two-day rise since April 2025. [2][7]

The selling began on Wednesday. A survey of US purchasing managers put services at 58.7, the highest in almost five years, and factories at 56.7, the highest in over four. [3]

The same survey showed the prices these companies pay were rising fast, a sign that more price rises are coming. [5]

Traders now see about a 71% chance that the US central bank raises its rate again in October, up from about 53% earlier in the week. [2]

Buyers were cooler on new US debt. A sale of five-year bonds on Wednesday had to pay 5.033%, the weakest result for that sale since 2018, according to Bloomberg. [4]

Tech companies raising money for AI data centres are selling bonds too, and they compete with the US government for the same investors. [5]

The selling spread abroad. Japan's 10-year yield reached 3.115%, its highest since 1996, and Australia's rose to 5.408%. [2]

Germany's debt agency said it expects to borrow a record 525.5 billion euros ($598 billion) this year, and more next year. [1]

Households feel it first. The average rate on a 30-year US home loan passed 7% for the first time in two years. [8]

US government debt passed $40 trillion in August. Its interest bill this year will top $1 trillion, more than it budgets for defence. [4]

Why it matters. Watch whether the 10-year yield stays above 5% into the US central bank's October meeting, where traders see about a 71% chance of another rise. [2]

Anna Paulson, head of the US central bank's Philadelphia branch, said some modest further rate rises may be needed. [12] She said underlying inflation is running at 2.5% to 3%, well above the 2% goal. [12] John Williams, who runs the New York branch, said another rise by the end of the year would be reasonable. [13] Traders' odds of an October rise vary by source, from 64% to 71%. [12][2]

Why it matters. The US central bank raised its rate to 3.75%-4% only last week. Each hint of another rise pushes up what banks charge for car loans, credit cards and business loans.

Norway's central bank raised its interest rate on Thursday. [15] Its governor, Ida Wolden Bache, said the rate will likely stay high for a time and could rise again. [15] Sweden's central bank held its rate but said it will likely raise before the year ends. [15] Mexico's central bank also held, but it dropped its earlier promise of a long pause. [2] The US, the euro zone and Japan all raised rates this month. [15]

Why it matters. These central banks fear that dearer fuel from the Iran war will spread into wages and other prices. Investors expect four more rises in Sweden by the end of spring. [15]

Switzerland's central bank kept its main interest rate at 0% on Thursday, while its big neighbours raise theirs. [16] Swiss prices rose only 0.8% in the year to August. [16] Energy is about 3.5% of what Swiss households buy, against about 7% in the euro zone. [16] When the world gets nervous, money flows into the Swiss franc, and a strong franc makes imports cheaper. [16]

Why it matters. Traders still expect Switzerland to raise rates three or four times over the next year. [15] Its franc has weakened this year, which makes imports dearer again. [16]

Only 197,000 Americans made new claims for unemployment benefit in the week to 19 September, down 1,000 on the week before. [11] Economists had expected 201,000. [11] Claims are near levels last seen in 1969. [11] The Labor Department's figures suggest the jobless rate stayed at 4.1% this month. [11] Companies are keeping the workers they have but are slow to hire new ones. [11]

Why it matters. Few layoffs are good news for workers. They also show an economy running hot, which is what the US central bank is raising rates to cool. [11]

Saudi Arabia said it shot down six ballistic missiles fired by the Houthis, a Yemeni group aligned with Iran. [30] Brent, the world's main oil price, briefly traded above $107 on Thursday. [19] It closed up 3.4%, its highest close since 15 September. [17] On Friday it slipped 0.82% to $105.73, while the US price fell to $93.05. [17] The gap between the two, $12.68, is the widest since May. [17]

Why it matters. Since the war began at the end of February, about a fifth of the world's oil and gas shipments have been cut off. [17] On Thursday, 80 countries at the United Nations demanded that the Strait of Hormuz reopen. [20]

US and Iranian negotiators in New York are exploring a deal in steps, according to sources close to the talks. [18] Iran would let ships through the Strait of Hormuz, the narrow sea lane out of the Gulf, and the US would lift its blockade of Iran's ports. [18] An earlier understanding collapsed. [18] Dennis Ross, a former US negotiator, put the chance of a deal before the 3 November US elections at 30%. [18]

Why it matters. A reopening would put more oil on the market and could bring down fuel prices around the world. The news alone pulled US shares off their lows on Thursday. [22]

The US Chamber of Commerce, the American Petroleum Institute and dozens of other business groups wrote to President Trump on Wednesday. [21] They warned that banning diesel exports would mean less fuel made and higher prices. [21] Trump has said he argued for a ban inside his government. [21] Diesel costs a US average of $6.51 a gallon, $2.82 more than a year ago. [21] Energy Secretary Chris Wright said nobody wants a full ban. [21]

Why it matters. An analyst at Rystad Energy said refineries would make less of everything to cut diesel, so petrol and jet fuel prices would soar. [5] Fear of a ban is the main reason US oil now sells $12.68 a barrel below Brent. [17]

The US said it would punish any company anywhere that did business with Iranian airlines after 23 September. [30] Its aim is to ground Iran's whole fleet. [30] Punishing firms in other countries for dealing with a target is called secondary sanctions. [30] By Thursday, Tehran's main airport listed no flights to the nearby Gulf states. [30] Iran's Tasnim news agency said flights to Oman, Georgia, Azerbaijan and Baghdad had stopped. [30]

Why it matters. President Trump calls the new approach 'economic D-Day'. [30] It adds to a US blockade of Iran's ports at sea, and it is the pressure Iran wants lifted in the New York talks. [18]

Donald Trump and China's leader, Xi Jinping, met for about three hours in Washington on Thursday. [25] Their trade truce, due to end on 10 November, now runs to 10 January. [25] It paused a trade war in which each side's tariffs on the other had topped 100%. [43] There was no sign of breakthroughs on AI, trade or rare minerals. [26] China is buying the 25 million tonnes of US soybeans it promised, but lags on $17 billion of other farm goods, according to Scott Bessent. [24]

Why it matters. Trade in goods and services between the two countries fell 25% last year. [28] Boeing is still waiting for China to firm up a promise, made in May, to buy 200 jets. [44] US farmers had pushed for new purchase deals and got none. [42] One small promise did come: Xi said China will soon send two pandas to the zoo in Atlanta. [25]

China's Commerce Ministry confirmed on Thursday that its trade negotiators had held their first talks with the US on artificial intelligence. [27] The US has proposed that each country warn the other when an AI problem becomes a matter of national security. [25] Xi Jinping said AI must always stay under human control. [25] The two sides also discussed cutting tariffs. [27]

Why it matters. US Democrats criticised Trump for loosening limits on selling high-end chips to China. [26] Nvidia's boss, Jensen Huang, was on the guest list for Thursday's state dinner. [25]

SoftBank, a Japanese investment group, sold $11.1 billion of bonds in dollars and euros. [29] Some of them pay as much as 9.75% a year. [29] Most of the money will pay for its stake in OpenAI, the maker of ChatGPT, which is set to grow to $64.6 billion. [29] SoftBank's shares jumped more than 7% on the news. [29]

Why it matters. SoftBank sold its bonds in the same week the US government had to pay more to borrow. Up to 9.75% is far more than the 5.5% the US government pays for 30 years. [2]

DeepSeek, the Chinese AI company whose models surprised the US tech industry last year, is now selling at a pace of $1 billion a year, according to The Information. [38] That is more than double a few months ago. [38] Part of the jump came from raising its prices 2.3 to 4.5 times. [38] It is seeking 50 billion yuan ($7.45 billion) at a value of 500 billion yuan. [38] Reuters could not check the figures. [38]

Why it matters. DeepSeek is preparing a possible listing on Shanghai's stock market for technology firms. [38] Its growth is part of the flood of money chasing AI in both China and the US.

Global debt rose by $10 trillion in the first half of this year to more than $365 trillion, the Institute of International Finance, a banking group, said on Wednesday. [6] Rich countries paid over $3.3 trillion in interest on their traded bonds last year. [6] That was more than the world spent on defence ($3.1 trillion), AI ($2.6 trillion) or clean energy ($2.3 trillion). [6]

Why it matters. The IMF's head, Kristalina Georgieva, said governments must bring debt down. [6] The OECD, a club of rich countries, said rising yields show governments need to cut or shift spending. [6]

The 10-year US yield was below 4.8% two weeks ago and above 5.17% on Thursday. [7] John Roque, an analyst at 22V Research, found 16 fast rises like this in 50 years. [7] He says each one was followed by some kind of financial crisis, from the 1987 crash to the failure of Silicon Valley Bank in 2023. [7] Steve Eisman said a fall in shares looks close unless yields drop back below 5%. [8]

Why it matters. Traders name two weak spots this time: private lending funds and AI data centres built with borrowed money. [7] A warning like this has no date and no target, so it cannot be checked until something happens.

The S&P 500, an index of 500 big US companies, spent much of Thursday morning deep in the red. [22] It closed flat after Reuters reported the US-Iran talks on Hormuz. [22] The Nasdaq 100, a list of big tech firms, also closed flat, and the Dow Jones index fell 0.3%. [22] In Asia on Friday, Japan's Nikkei rose 1% and Hong Kong's Hang Seng fell 1%. [2]

Why it matters. Shares have so far shrugged off higher borrowing costs because company profits are strong. [1] A 5% risk-free return on US bonds gives investors a reason to sell shares. [8]

The dollar rose more than 1% this week to a two-month high against other big currencies. [10] It is on course for two weekly gains in a row for the first time since June. [10] The euro fell to $1.1370, its third weekly fall, and the pound neared a three-month low of $1.3220. [10] Gold fell more than 2% this week to about $4,271 an ounce. [14]

Why it matters. Higher US interest rates draw money into dollars. A strong dollar makes gold, which is priced in dollars, dearer for buyers using other money. [14]

The US Treasury said on Thursday it bought back $4.078 billion of bonds that come due in 20 to 30 years. [23] Holders offered it $10.468 billion, and it had planned to buy up to $6 billion. [23] Treasury Secretary Scott Bessent has also bought yen, so that officials in Japan would not sell US bonds to defend their currency. [1]

Why it matters. Buying back old bonds shrinks the pile of long US debt that investors must hold. The 30-year yield still hit its highest since 2004 the same day. [1]

Russia's finance ministry sent a draft budget for 2027 to 2029 to Russia's cabinet, which will review it before 1 October. [31] It calls defence and security a 'strategic priority'. [31] It proposes taxes on extra profits in metals and fertiliser, and on online trade across borders. [31] It would also raise tax on income from shares, property sales and bank interest, hitting about 4 million people. [31]

Why it matters. The war in Ukraine is in its fifth year, and Russia's economy slowed sharply last year. [31] Savers holding money in Russian banks would keep less of their interest.

A committee of Indonesia's parliament approved 4,106.3 trillion rupiah ($231 billion) of spending for 2027 on Thursday. [32] The gap between spending and income is set at 2.4% of the economy, down from 2.85% this year. [32] Spending and the tax target both rose by 9.1 trillion rupiah, so the gap did not change. [32] Education got 14 trillion rupiah more. [32]

Why it matters. Worries about President Prabowo's spending helped push the rupiah, Indonesia's currency, to a record low in June. [32] Dearer oil adds to those worries, because the state pays to keep fuel cheap. [32]

Poverty in Argentina could rise to 35% of people by the end of the year, from 28% in 2025, according to estimates from the Catholic University of Argentina. [33] Its researchers say 400,000 to 450,000 people have fallen into poverty every quarter for a year. [33] President Javier Milei slowed runaway inflation, and poverty fell sharply under him. [33]

Why it matters. Milei faces an election in 2027, and his support among poorer voters has dropped. [33] In one Buenos Aires suburb, a teacher has started a barter club where people swap goods instead of paying cash. [33]

Homes sold in Australia fell 15% from a year earlier from June onwards, while prices are down less than 4% from their March peak. [34] Reuters worked out that this strips A$355 million to A$710 million a month from businesses paid when homes change hands. [34] They include estate agents, conveyancers, removalists and furniture shops. [35] Higher interest rates and cuts to property tax breaks are slowing sales. [34]

Why it matters. The damage comes from fewer sales, not lower prices. [34] Australia's central bank is expected to raise its rate again next week, to 4.60%. [10]

BP, the British oil company, has looked at the private sales files for a few US shale oil fields up for sale, six sources told Reuters. [36] They include Devon Energy's Eagle Ford fields in Texas, which analysts value at about $4.5 billion. [36] Looking at the files does not mean BP will bid. [36] Devon's shares rose 1.8% on Thursday. [36]

Why it matters. BP spent 18 months selling assets and cutting debt, and is now turning back to oil and gas. [36] It wants its US shale business to pump over 650,000 barrels a day by 2030. [36]

France's Credit Agricole and Italy's UniCredit have discussed a joint move on Banco BPM, Italy's fourth-largest bank, two sources told Reuters. [37] One idea would see UniCredit hand Credit Agricole about a third of the bank. [37] Credit Agricole already owns 29.3% of Banco BPM. [37] Another Italian bank, Monte dei Paschi, also wants to buy Banco BPM. [37]

Why it matters. UniCredit failed to buy Banco BPM in 2025. [37] A foreign takeover of a big Italian bank would be politically hard for Prime Minister Giorgia Meloni before next year's election. [37]

63% of family offices, the firms that invest money for very rich families, named rising prices as their top worry in a Citi survey. [39] Last year only 37% did. [39] Worry about trade fights and tariffs fell from 60% to 18%. [39] Yet a net 34% put more money into shares over the past year. [39]

Why it matters. The survey of 351 firms was taken in June and July, before this week's bond selling. [39] It shows how quickly the fear of rising prices replaced the fear of tariffs.

Jumbo, a Greek chain of toy and household shops, said sales rose 4% to 590 million euros in the first half of 2026. [40] Profit rose 3% to 121 million euros. [40] Sales grew 7% in Greece and 11% in Bulgaria but fell 6.5% in Romania. [40] Higher prices, a weaker currency and a sales tax rise hurt shoppers there. [40]

Why it matters. The company has 546 million euros in cash and no debt. [40] Its Romanian shoppers show how a tax rise and a weak currency reach a shop till. [40]

Elroy Air, which builds large cargo drones that fly themselves, raised its funding to $175 million before joining the stock market. [41] It is joining the market by merging with Inflection Point, a listed company set up only to buy another firm. [41] It recently won a US Army contract worth up to $46 million. [41] Its drone, the Chaparral, carries more than 500 pounds up to 450 miles. [41]

Why it matters. It flew the first crewless flights allowed under a US aviation test programme. [41] Bristow, a helicopter company, raised its early orders from five drones to 15. [41]