Barron’s (January 27)
“Japan is the market’s ‘Big Story.’” Proposals for a “looser fiscal policy” have resulted in “big moves in the yen and Japanese government bonds that have investors increasingly on edge around the world.” Now all eyes are on the 40-year JGB auction, which really “matters for U.S. and European investors. If prices fall, sending yields higher it, it could make Japanese bonds attractive enough for local investors to move money invested abroad back to Japan.”
Tags: 40 year, Abroad, Europe, Investors, Japan, JGBs, Looser fiscal policy, Market, Money, Prices, U.S., Yen, Yields
MarketWatch (November 21)
“Developments in Japan are now creating the risk that U.S. yields could rise alongside Japan’s yields.” Amid budget concerns over proposed fiscal stimulus, yields on JGBs “hit their highest levels in almost two decades, with the country’s 10-year rate spiking above 1.78% to its highest level in more than 17 years” while 40-year yields “climbed to an all-time high just above 3.7%.” Since Japan “is the biggest foreign holder of Treasurys, with a roughly 13% share… the concern is that the country’s investors might one day pull the rug by keeping more of their savings at home.”
Tags: 1.78%, 3.7%, Budget, Developments, Fiscal stimulus, Investors, Japan, JGBs, Risk, Savings, Treasurys, U.S., Yields
Wall Street Journal (April 21)
“If the White House wanted a test of how firing Jerome Powell would go over in the markets, it succeeded on Monday. U.S. stocks and the dollar plunged while yields on long-term Treasurys climbed after President Trump renewed his attacks on the Federal Reserve Chairman.” The President “thinks he can bully everyone into submission, but he can’t bully Adam Smith, who deals in reality. Markets know tariffs are taxes, and taxes are anti-growth.” It is clear that the “Trump tariffs are the biggest economic policy mistake in decades.” What remains unclear is the President’s ability to see reality. “Markets are spooked because they don’t know if Mr. Trump listens to anyone but his own impulses.”
Tags: Adam Smith, Anti-growth, Attacks, Bully, Dollar, Fed, Firing, Markets, Mistake, Plunged, Powell, Reality, Spooked, Stocks, Submission, Tariffs, Taxes, Treasurys, Trump, U.S., White House, Yields
The Economist (April 19)
The dollar is meant to be a source of safety. Lately, however, it has been a cause of fear. Since its peak in mid-January the greenback has fallen by over 9% against a basket of major currencies.” Meanwhile, the yield on Treasuries has been rising. “That mix of rising yields and a falling currency is a warning sign: if investors are fleeing even though returns are up, it must be because they think America has become more risky,” which explains the rumors that “big foreign asset managers are dumping greenbacks.”
Tags: Asset managers, Basket, Dollar, Dumping, Falling, Fear, Fleeing, Greenbacks, Investors, Major currencies, Peak, Returns, Risky, Safety, Treasuries, Warning sign, Yields
Inc. (January 9)
“Everyone loves talking about the stock market, but the $28 trillion Treasury market is the fortuneteller of the pair—bonds are now flashing warnings of a Fed policy error, resurgent price pressures, and a ballooning debt pile.” Contrary to expectations, “bond yields have surged since the Fed began cutting interest rates.”
Tags: Ballooning debt, Bonds, Fed, Fortuneteller, Interest rates, Policy error, Price pressures, Stock market, Treasury market, Warnings, Yields
Reuters (September 28)
“Treasury yields and the dollar fell while the Dow registered a record closing high on Friday as a subdued U.S. inflation report lifted expectations of an outsized interest rate cut at the Federal Reserve’s November policy meeting.” On top of that, “a global stock index also reached a record high, helped by China’s stimulus boost, and European shares posted an all-time high close.”
Tags: China, Dollar, Dow, Europe, Expectations, Fed, Global stock, High, Index, Inflation, Interest rate, Policy meeting, Record, Stimulus, U.S., Yields
Wall Street Journal (February 17)
“Treasury yields have sprung to multiyear highs, forcing the U.S. government to pay a lot more in interest and putting pressure on the budget.” Over the new decade, federal interest costs are now expected to rise by $1.1 trillion, reviving “Wall Street worries that the years-long acceleration in borrowing under both political parties will eventually weigh on economic growth and asset prices.”
Tags: $1.1 trillion, Asset prices, Borrowing, Budget, Costs, Economic growth, Interest, Pressure, Treasuries, U.S. Government, Wall Street, Worries, Yields
Financial Times (December 16)
“European bonds rallied on Friday, pushing yields to nine-month lows as investors focused on the latest signs of a slowing economy and shrugged off the European Central Bank’s insistence that it was not considering interest rate cuts.” Given the Fed’s pivot, markets appear skeptical of “ECB president Christine Lagarde’s insistence on Thursday that it was too soon to talk about the timing of rate cuts and that the bank had ‘more work to be done’ in its battle to tame inflation.”
Tags: Bonds, ECB, European, Inflation, Insistence, Interest, Investors, Lagarde, Lows, Rallied, Rate cuts, Slowing Economy, Timing, Yields
Bloomberg (December 1)
“For all the bullish milestones notched by November’s big market surge, recent history offers Wall Street a lesson in caution. Time and time again, speculation breaks out that the Federal Reserve is poised to ease monetary policy soon enough — spurring even cautious investors to erupt in a spasm of cross-asset buying. Stocks jump, bond yields fall, and a dash ensues among equity speculators into shady corners encompassing everything from meme fliers to crypto and profitless tech.”
Tags: Bonds, Bullish, Caution, Cautious, Cross-asset buying, Crypto, Fed, Investors, Market surge, Monetary policy, November, Speculation, Stocks, Tech, Wall Street, Yields
New York Times (October 20)
“One of the most important interest rates in the world this week flirted with a level it hadn’t reached in more than 16 years, putting pressure on the economy and the stock market.” Yields on 10-year Treasuries “brushed against 5 percent for the first time since mid-2007 before ending the week around 4.9 percent.”
Tags: 10-year Treasuries, 16 years, 2007, 5%, Economy, https://www.nytimes.com/2023/10/20/business/treasury-bond-yield-5-percent.html Interest rates, Pressure, Stock market, World, Yields
