The world’s most important central banks will potentially hand investors fresh reasons to sell government bonds this week as policymakers find themselves forced to confront the risk of a war-driven inflation shock.

he dollar is regaining its crown as one of the world’s most appealing assets, defying talk of a “Sell America” trade that had raised troubling questions about the outlook for the global reserve currency.

Treasuries have powered into first place among major sovereign bond markets this year as the prospect of a new round of Federal Reserve interest-rate cuts overturns widely held bearish views on US debt.

Bonds extended losses as investors mulled the prospect of slower US interest-rate cuts, a trend that risks upending debt positions everywhere.

Global bonds are slumping after two shock interest-rate hikes this week served traders a reality check that central banks are far from done fighting inflation.