US home sales plunged to a 12-year low after mortgage rates topped 7%, driven by soaring global borrowing costs. Increasing energy prices and higher-for-longer inflation expectations have sent debt costs to recent records, with US bond yields touching a 24-year high and European debt climbing to levels not seen in decades.
Higher borrowing costs are impacting poorer nations, as well: The UN warned several countries were facing a “liquidity crisis” that could push millions into poverty, with developing countries now on average spending 9.5% of government revenues on interest payments, the highest share in a quarter century. “The global economy could soon test the limits of resilience,” the IMF’s chief economist said.