Treasury yields rise as inflation fears drive global bond rout
U.S. Treasury yields continued their rise on Monday as global bond markets sold off on concerns about a resurgence of inflationary pressures.
10-year US Treasury The bond yield, the key measure of US government debt, rose more than 2 basis points in the first hours, reaching a 15-month high of 4.6173%.
longer dated 30-year Treasury bond The yield, which is more sensitive to political risks, is now at 5.1418%, a two-decade high, after rising 1 basis point on Monday.
2-year Treasury bill The yield, which tends to respond appropriately to short-term Federal Reserve interest rate decisions, also rose more than 1 basis point to 4.1008%.
One basis point equals 0.01%, and yields and prices move in opposite directions.
U.S. Treasury yields rose last week, with the 10-year yield rising 14 basis points, as new Fed chairman Kevin Warsh faces rising consumer prices and rising import costs.
The latest rise in borrowing costs hit global markets on Monday ahead of a key meeting of G7 finance ministers and central bankers in Paris later.
Yield 10-year German bonds Japan’s 10-year JGB index rose 13 basis points to 2.739%, while it rose more than 2 basis points to 3.1827%.
returns in uk 10 years of GildedA gauge of British government debt eased slightly. Yields fell about 1 basis point in early deals but remain elevated at 5.169% due to uncertainty over the fate of British Prime Minister Keir Starmer. 30 years of Gilded Its yield fell nearly 3 basis points to 5.818%.
Will Hobbs, Brooks Macdonald’s chief investment officer, said central bankers now face a tightrope on interest rates, with economic fallout from the Middle East conflict front and the heart of the G7 summit.
“Inflation will be a thorny and frustrating issue for central banks and bond investors,” Hobbs told CNBC’s ‘Europe Early Edition’ on Monday.
Oil prices rose again on Monday Brent crude oilWhile oil, the international indicator, increased by 1.8% and reached $111.16 per barrel, the US West Texas Intermediate Futures were last trading up more than 2% at $107.56 per barrel.
Lizzie Galbraith, Aberdeen’s senior political economist, said the energy price shock and ongoing political turmoil in Britain, which could herald a decisive shift to the left under the new Labor prime minister, were placing an “extra risk premium” on UK gold.
