All articles tagged with #bond selloff
A global selloff in long-dated bonds continues, with yields reaching record highs in Japan, UK, and the US, driven by concerns over government debt and inflation, prompting a surge in gold prices to an all-time high as investors seek safe-haven assets.
The U.S. Treasury market experienced a selloff driven by increased bond issuance in September, rising yields nearing 5%, and global government bond declines, amid investor uncertainty and a competitive environment for yield across various fixed-income segments.
Global stocks experienced a significant decline as the 10-year Treasury yield surpassed 5%, raising concerns about the impact of rising borrowing costs on economic growth. The yield on the 10-year bond reached its highest level since 2007, leading to a retreat in stock markets. Weaker-than-expected earnings from companies like Volkswagen and Royal Philips also contributed to the negative sentiment. Investors are becoming more bearish on risk assets as the bond selloff intensifies, prompting a shift towards safer investments like Treasuries.
The recent bond selloff, which has led to rising yields, may compel the Federal Reserve to reconsider its plans for shedding assets. The central bank's strategy of reducing its balance sheet by selling Treasury bonds and mortgage-backed securities could be affected by the market volatility caused by the selloff. The Fed may need to adjust its monetary policy to address the impact of rising yields on financial conditions and the broader economy.
The bond selloff continued, causing US stocks to decline, while big tech companies were relatively unaffected. Yields on Treasuries rose, with the 10-year benchmark bond reaching its highest level since 2007. The Federal Reserve's messaging about the need to keep borrowing costs high to control inflation contributed to the market reaction. Energy stocks sold off, erasing gains for the year, while the Nasdaq 100 saw a slight increase due to the performance of major technology firms. The dollar strengthened, gold prices fell, and oil prices retreated. Traders now see a higher likelihood of a November rate hike by the Fed.