European and Japanese bond yields rise as oil spike revives inflation fears

European and Japanese borrowing costs rose as investors reassessed inflation risks and the likelihood of tighter monetary policy. Reuters reported that Germany’s 10-year yield climbed on the oil-price spike, while Japan’s two-year yield hit a 31-year high as traders increased bets on further Bank of Japan tightening. The move came as escalating Middle East tensions pushed oil to six-week highs, reviving concerns that higher energy costs could keep inflation elevated and force central banks to stay restrictive for longer.