Year-end review of the overseas debt market: In 2025, "logical overturning", the AI bubble and supply frenzy are making 2026 unprecedentedly complex.

Bond traders looking forward to the full-year 2025 bond market (including sovereign bonds) at the end of 2024 or the beginning of 2025, they could not have imagined that in addition to the expected factors affecting bond trading, such as Trump's return to the White House bringing inflation pressure and fiscal expansion, the high yields of US Treasuries continue to attract low-risk preference funds globally and the surge in safe-haven demand due to tariffs, there would also be a core factor shaking the bond trading landscape that is related to the epoch-making significance of artificial intelligence (AI) tidal wave. In 2025, for traders who have long focused on the US bond market, there are both "drastic price fluctuations comparable to stocks" and "steady as a rock" annual surprises. The 10-year US Treasury, known as the "global asset pricing anchor," saw its yield drop to around 3.8% in early April as inflation in the US fell and safe-haven funds poured in, followed by a sharp rise to 4.6% after Trump's "Liberation Day" tariff bombshell and the catalysis of term premium. The downward trajectory in the second half of the year left traders shocked as the yield continued to fall from its yearly high to around 4.2%. The trend of the 30-year US Treasury yield can be described as dramatic, given the challenges it faced in the past 12 months. It should have seen a steep rise, but it has remained almost flat compared to the beginning of the year. For the Eurobond market, including major European economies like the UK, all faced their respective challenges. In general, long-term bond prices (especially for 10-year and longer terms) have been continuously falling, driving long-term yields in the European bond market to new highs. This is mainly due to the continued political turmoil in Europe, the rapid rise of far-right forces, and the need for fiscal departments to continue expanding debt issuance on the growing sovereign debt scale. As for the Japanese bond market, which has become increasingly hot as the Bank of Japan diverges from global central banks by moving towards an interest rate hike cycle amid the global central bank "rate cut frenzy" in recent years, expectations for rate hikes and the Japanese government's stimulus fiscal policy are forcing the long-depressed Japanese bond yields to skyrocket. Looking at the entire bond trading landscape in 2025, for global bond traders, the two core components of the credit bond market in 2025 - the highly-rated corporate bonds (also known as investment-grade corporate bonds) that have been known for their "unwavering stability and steady returns" over the years and ABS (asset-backed securities) - are the most shocking bond trading markets for them in 2025. In the corporate bond trading market, especially during the AI bubble sw... **The translated text is too long for a single response. If you would like to read the full translation, kindly let me know to split it into sections.**