This report does not constitute a rating action. Elevated and volatile government bond yields are a key risk for our ratings on some global financial institutions over the next three-to-12 months. Government bond yields have risen substantially across several major markets this year, with particularly sharp increases in parts of Europe and Japan (see chart 1). In the U.S., the 10-year Treasury yield averaged 5.13% in October, its highest level since 2007, although it had declined to 4.94% by month-end. Despite this recent decline, yields remain elevated and renewed increases could put further pressure on financial institutions. Yields are 81 basis points (bps) above their average just six months ago, and 93 bps above the median since 1990. So far,
