HomeFinancial MarketsGlobal Bonds Fall Ahead of Fed Chair Testimony

Global Bonds Fall Ahead of Fed Chair Testimony

Treasury yields worldwide fell on Tuesday, with markets expressing concerns that stubborn inflation could result in continued aggressive money-tightening policies from central banks across the globe.

UK 10-year yields rose eight points to their highest level since last September, while U.S. 10-year yields gained three basis points. UK investors are awaiting the release of the nation’s latest inflation data on Wednesday, with U.S. observers anticipating Federal Reserve Chairman Jerome Powell’s testimony before Congress that same day.

“There is no question the momentum has shifted, with US yields climbing even after the Fed paused and University of Michigan inflation expectations dropped,” Prashant Newnaha, a rates strategist at TD Securities Inc. in Singapore remarked. “The prospect that the BOE and ECB will need to do more to get on top of inflation puts pressure on bonds globally.”

Asian treasuries also declined, as did Australian bonds following the Australian central bank’s meeting and its surprise rate hike. The country’s 10-year yield rose by two basis points to 3.99%; having previously hit a year-to-date high of 4.05%.

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