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Wall Street Journal
6 days ago
- Business
- Wall Street Journal
Long-Dated German Government-Bond Yields Could Rise Further
1018 GMT – Yields on 30-year German government bonds could rise further after hitting their highest level since 2011 on Tuesday, ING says. The prospect of German fiscal stimulus increasing debt levels, combined with external concerns about U.S. deficits, risk pushing long-dated yields higher, it says in a note. 'While the 30-year German Bund yield hit its highest since 2011 on Tuesday, surpassing the previous 2023 high, we think there are enough arguments that this is not the end yet,' UBS says. The 30-year German Bund yield last trades at 3.2439%, having hit a high of 3.3090% on Tuesday, LSEG data show. ( 0708 GMT – U.S. Treasury yields remain lower as a Federal Reserve interest-rate cut in September looks much more likely after Tuesday's headline U.S. inflation data came in slightly below expectations. Investors were relieved that the data didn't show tariffs having a big impact on prices. U.S. money markets are now pricing in a 98% chance of a September rate cut, up from around 88% on Tuesday. Short-dated yields fell the most, causing the yield curve—the gap between short-dated and long-dated yields—to steepen on Tuesday. U.S. 10-year Treasury yields are last down 2 basis points at 4.273%, Tradeweb data show. (
Wall Street Journal
11-08-2025
- Business
- Wall Street Journal
Bund Yields Fall; Supply, ZEW Data Could Provide Support
0803 GMT – German Bund yields fall at the start of the week, reversing some of Friday's rise. Bunds could garner some support this week, helping yields to fall further, due to modest supply and the prospect of weak German ZEW data on Tuesday, Commerzbank rate strategists say in a note. Only two bond auctions are due this week, with bond sales from Germany and Finland. These should 'provide support for Bunds, probably within the established ranges,' the strategists say. External impetus will also be key, particularly Tuesday's U.S. inflation data. The 10-year Bund yield falls 2 basis points to 2.663%. ( 0725 GMT – U.S. Treasury yields edge lower after rising last week following weak demand at auctions of three-year, 10-year and 30-year auctions. This caused the 10-year yield to hit its highest in a week. Trade calms on Monday as tariffs which took effect last week have so far had limited impact on markets. However, yields risk rising, Capital Economics' James Reilly says in a note. Weak Treasury auctions remind investors 'that huge public debt to GDP ratios are not going anywhere fast.' Tuesday's U.S. inflation data could also cause yields to rise if prices increase more than expected, he says. The 10-year Treasury yield falls 2 basis points to 4.264%, having hit a high of 4.289% on Friday, Tradeweb data show. (
Wall Street Journal
06-08-2025
- Business
- Wall Street Journal
U.S. Treasury Yields Rise by More Than German Bund Yields
1016 GMT – U.S. and eurozone government bond yields both rise in midday European trading. U.S. Treasury yields rise by a greater amount, however. While a weak U.S. labor market accentuates growth fears, fiscal issues keep inflation fears alive. There is little immediate input for bonds from the Federal Reserve or the European Central Bank for now. 'On central banks, our view remains unchanged, and we see two rate cuts from the Fed…, one from the ECB and two from the Bank of England,' Jefferies' Mohit Kumar says in a note. The 10-year Treasury yield is up 4.2 basis points at 4.237%, while the 10-year German Bund yield rises 2.5 basis points to 2.649%, according to Tradeweb. ( 0610 GMT – German Bunds continue to trade in their summer range, though volatility could decline amid a thin data calendar, says Commerzbank Research's Erik Liem in a note. 'A quiet day appears to lie ahead,' the rates strategist says. German new orders will set the tone with the European opening, while the data calendar remains largely depleted ahead of Thursday's likely Bank of England interest-rate cut, he says. Germany's 2.5 billion euro auction of May 2038- and July 2042-dated Bunds, with results at 0930 GMT, could weigh on Bunds in the morning, Liem says. The 10-year Bund yield is flat at 2.622% after opening, according to LSEG. (
Wall Street Journal
22-07-2025
- Business
- Wall Street Journal
Eurozone Bond Yields Edge Up, Reversing Monday's Falls
0638 GMT – Eurozone 10-year government bond yields rise in early trade, reversing Monday's significant falls which had no obvious macro catalyst, says Danske Bank's Frederik Romedahl in a note. 'Low volumes, light issuance this week and ongoing trade uncertainty might have been the factors driving the steady decline during the day,' the chief analyst says. Yields on Italian and French government bonds fell the most on Monday, dropping by 10.5 and 10.6 basis points, respectively, according to Tradeweb data. The 10-year German Bund yield is last up 1.2 basis points at 2.626%; the 10-year French OAT yield rises 1.9 basis points to 3.310%; and the 10-year Italian BTP yield is up 1.6 basis points at 3.494%. ( 0616 GMT – The U.S. Treasury yield curve has steepened recently, but it still isn't steep by historical standards, say LPL Financial's LPLA -3.49%decrease; red down pointing triangle Lawrence Gillum and Adam Turnquist in a note. Historically, the difference between the two- and 10-year Treasury yields is close to 100 basis points, albeit with a lot of variability, the strategists say. 'The 2-year/10-year spread is only at +0.55%, so we think the curve could further steepen throughout the year,' they say. Given this spread but with five times the interest rate risk, 'it doesn't make a lot of sense, in our view, to extend duration within portfolios.' The two-year Treasury yield last is up 1 basis point at 3.861%; the 10-year yield rises 1.3 basis points to 4.381%, according to Tradeweb. (
New Straits Times
23-05-2025
- Business
- New Straits Times
Dollar under pressure and all eyes on Treasuries as US fiscal anxiety rises
LONDON/SYDNEY: The dollar headed for its first weekly fall in five weeks against major currencies on Friday and long-dated Treasury yields stayed elevated, as US debt concerns that have mounted for years started driving moves in currencies and global debt. Investor attention has switched from tariff anxiety to US fiscal concerns in a week where Moody's downgraded the US credit rating and the Republican-controlled House of Representatives on Thursday passed a sweeping tax and spending bill. Futures contracts tracking Wall Street's benchmark S&P 500 share index were steady in European morning trade as investors balanced the tax-cut boost to corporate earnings with longer-term concerns about the US economy. "It's good for corporates initially, and clearly you're seeing the flip side of that in Treasury markets," Netwealth CIO Iain Barnes said. But with long-dated debt yields' tendency to impact valuations of other assets, from global currencies to stocks, he said investors were nervous that any further volatility in 30-year Treasuries could start rippling across global markets. "Multi-asset investors' primary concern is thinking about how these different asset classes respond to each other," he said, adding that he was keeping his own portfolios broadly diversified and neutral on market risk for now, in line with much of the investment industry. With the U.S debt pile already at US$36 trillion, President Donald Trump's plans to slash taxes, cut federal budgets and boost military and border enforcement spending has sparked rollercoaster moves in the long-term debt yields that set the nation's borrowing costs. The 30-year Treasury yield was 4 basis points lower but held just above 5 per cent after hitting a 19-month high in the previous session. "There is certainly nothing in this market move or the passage of this version of the bill that tells me there is going to be meaningful reduction in US bond issuance or this broader concern about global bond supply," said Ken Crompton, senior interest rate strategist at the National Australia Bank. Yields on 30-year Japanese bonds, which hit record highs earlier in the week as selling driven by domestic fiscal and inflation concerns was exacerbated by moves in US debt, recovered slightly, declining by 5 bps to around 3.10 per cent . Data on Friday showed Japan's core consumer price inflation climbed 3.5 per cent in April in its steepest annual increase for more than two years, raising pressure on the Bank of Japan to keep hiking interest rates. In the euro area, German Bund yields dipped on but stayed on track for their fifth straight weekly rise, tracking US Treasuries. The benchmark European debt has sold off despite money markets showing that traders anticipate the European Central Bank cutting its main deposit rate to about 1.75 per cent by year-end . DOLLAR DECLINE In currency markets, the euro firmed 0.5 per cent to US$1.1335 . An index tracking the US currency against a basket of peers including the euro and Japan's yen, was 0.2 per cent lower and down 1.3 per cent on the week in its first weekly drop since late April. Despite the euro's gain, which tends to knock exporters' shares, Europe's Stoxx 600 share index gained 0.3 per cent in early dealings and Germany's Xetra Dax added 0.4 per cent, as traders stayed cautious towards US assets. Japan's Nikkei also gained 0.5 per cent on Friday, with MSCI's broadest index of Asia-Pacific shares outside Japan rising by the same amount. Bitcoin prices dipped from its record high but it was still set for a weekly gain of 6.4 per cent to US$110,796. Oil prices dropped for a fourth consecutive session and were set for their first weekly decline in three weeks, weighed down by renewed supply pressure from another possible OPEC+ output hike in July. Brent futures fell 0.85 per cent to US$63.89 a barrel and US West Texas Intermediate crude futures fell 0.9 per cent to US$60.65. In precious metals, gold prices rose just over 1 per cent to US$3,321 an ounce.
