Fitch warns: AI boom and rising yields threaten global markets.

Fitch Ratings has warned that global credit risks are deteriorating as we head into 2027, citing uncertainty over artificial intelligence investment, high energy prices, and tightening financing conditions, according to reports. Fitch expects the Federal Reserve's policy rate to reach 4.25% and remain at that level throughout 2027, with one more rate hike expected this year. The agency forecasts the U.S. 10-year Treasury yield will reach 4.8% by the end of 2027, but warns that a prolonged disruption in the Strait of Hormuz could push yields higher. Fitch also highlighted that AI infrastructure spending may outpace sustainable demand, potentially triggering a sharp pullback in investment.