Government bond markets took centre stage this week as persistent worries about ballooning levels of issuance drove benchmark yields in the US, Europe and Japan to six-month highs.

Inflation concerns further fuelled the bond sell-off as oil surged above $66 a barrel and the dollar weakened, heightening expectations of increased buying of commodities. Global equities moved moderately higher – managing a third successive month of gains for the first time since the credit crisis began – although US and European indices failed to retest the 2009 highs struck at the start of May.