Post #16245

Global Yields Analysis: The Bond Market Is Now Snapping Government bonds are selling off simultaneously across every major economy. Japan's 30-year yield hit 4% for the first time since 1999. UK 10-year gilts reached 5.14%, highest since 2008. US 10-year Treasuries at 4.55%, a one-year high. G7 yields up an average 15 basis points this week alone. The driver is singular: war-driven inflation. Markets now price a 60% probability of a Fed hike this year — before the war, two cuts were expected. Only 4 of 24 major central banks retain any meaningful chance of cutting rates. The transmission to equities is direct. The 10-year Treasury yield now exceeds the S&P's earnings yield — a mathematical argument for selling stocks that has not existed since 2003. For risk to stabilize, either oil must decline on a ceasefire or central banks must act decisively enough to restore credibility. Neither has materialized. Until one does, this repricing has further to run. read the full article here. — Alan