The bond market is going through a difficult phase across all longer maturities. Yields are rising, and the prices of securities already in circulation are consequently falling. Public debt remains under pressure, and government bonds are suffering on both sides of the Atlantic. In addition, liquidity is being drained by the massive issuance from AI hyperscalers, as the ECB has just pointed out.

Between the Fed and the ECB, fixed income remains under pressure

The interest-rate environment remains the primary problem for the entire fixed-income market. From Jackson Hole, the Fed confirmed its cautious stance, with inflation still too sticky to promise rapid rate cuts. This scenario is keeping yields high on longer maturities and weighing on both corporate and government bond issuance.

Against this already tense backdrop came the analysis published on the ECB’s own blog, focusing on the debt of U.S. Big Tech companies. The stock of euro-denominated bonds issued by hyperscalers has reached approximately €40 billion. Euro-denominated issuance now accounts for almost 10% of all bond debt issued by these companies.

Hyperscalers seek liquidity in Europe

Reverse Yankee issues, meaning euro-denominated bonds placed by U.S. issuers, nearly doubled between 2025 and 2026. Big Tech companies now account for just under 10% of gross new euro-denominated issuance by non-financial companies. The ECB’s warning is precise. The growing presence of these giants could drive up financing costs across all sectors.

The race to build data centers has transformed companies that used to finance themselves internally into major debtors. In fact, most of them have suspended or reduced their share buyback programs. In the autumn of 2025, four massive bond placements arrived within just a few weeks.

Meta’s remains the largest-ever investment-grade issuance not linked to acquisitions. In 2026, the pace has accelerated further. As of August 10, issuance by Alphabet, Amazon, Meta, Microsoft, and Oracle had reached $220 billion, according to BNP Paribas data. Across all of 2025, it had stood at $121 billion, already four times the average of the previous five years.

Prices reveal the bonds’ distress

Prices quoted on the Frankfurt Stock Exchange show the troubled performance of this flood of paper. The Oracle 5.95% 2055 bond was issued at 100 less than a year ago. Today, it trades at 78, a loss of -22% from its issue price.

The Meta 6.45% 2066 bond was issued only in May 2026. In three and a half months, its price has already fallen from 100 to 90, a loss of -10%.

The maturity curve makes the difference. The Meta 4.95% 2033 bond still trades at 97 and is holding up much better than its longer-dated counterparts. This also reflects the broader tension affecting longer maturities. With maturities equal, the issuer also matters. The Alphabet 5.45% 2055 bond trades at 87.5. The Oracle 5.95% 2055 bond, by contrast, trades at 78. Oracle pays a higher coupon but is worth almost 10 points less. That 9.5-point gap measures the risk premium demanded by the market for Oracle, which is highly indebted.

Financing AI is becoming increasingly expensive

The European market is financing the race toward artificial intelligence, but at increasingly lower prices and higher yields. Investors who bought at the placements are now posting losses even on highly solid issuers. This competition is weighing on the entire fixed-income market, including government bonds. The cost of capital for the AI revolution is rising quarter after quarter for companies.