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A new round of rate-hike alerts in the US has been sounded! A subtle shift inside the Fed sparks fears of turmoil ahead in global bond markets
A new round of US rate-hike alerts has been sounded, and a subtle shift within the Federal Reserve has raised concerns that turbulence may be coming for global bond markets. On Wednesday, global government bond prices continued to slide, pushing borrowing costs in countries worldwide up to multi-decade highs. In the eurozone, the benchmark German 10-year government bond yield hit its highest level since 2011. In the UK, the 10-year government bond yield touched a 5.25% high not seen since 2008. Japan’s 10-year government bond yield broke above the key psychological level of 3%. After the widely watched US 10-year government bond yield broke through 4.80% during the session, it gave back gains by late trading. However, risks may not be over yet. With tensions in the Middle East continuing to drive up international oil and natural gas prices, inflation expectations have been further strengthened, intensifying tightening pressure across major economies. Hawkish rhetoric within the Fed is also increasing the risk of a rate hike this month, while fiscal concerns in countries around the world are escalating as well. Within the Fed, the stance on rate hikes is undergoing a subtle change. Last week, during the Fed chair’s Jackson Hole speech at the annual central bank meeting in Jackson Hole, Wyoming, Fed Chair Kevin W. Kash compared to the past he was more direct in explaining the economic outlook, saying that if conditions are appropriate, the Fed would support a rate hike. “We have to be sure that underlying inflation is moving clearly and at a sufficiently fast pace toward our target. If not, then we must take action,” W. Kash said. #美国8月ADP就业创1月来最小增幅 #沙特称伊朗在霍尔木兹袭击其船只
A new round of rate-hike alerts in the US has been sounded! A subtle shift inside the Fed sparks fears of turmoil ahead in global bond markets
A new round of US rate-hike alerts has been sounded, and a subtle shift within the Federal Reserve has raised concerns that turbulence may be coming for global bond markets. On Wednesday, global government bond prices continued to slide, pushing borrowing costs in countries worldwide up to multi-decade highs. In the eurozone, the benchmark German 10-year government bond yield hit its highest level since 2011. In the UK, the 10-year government bond yield touched a 5.25% high not seen since 2008. Japan’s 10-year government bond yield broke above the key psychological level of 3%. After the widely watched US 10-year government bond yield broke through 4.80% during the session, it gave back gains by late trading. However, risks may not be over yet. With tensions in the Middle East continuing to drive up international oil and natural gas prices, inflation expectations have been further strengthened, intensifying tightening pressure across major economies. Hawkish rhetoric within the Fed is also increasing the risk of a rate hike this month, while fiscal concerns in countries around the world are escalating as well. Within the Fed, the stance on rate hikes is undergoing a subtle change. Last week, during the Fed chair’s Jackson Hole speech at the annual central bank meeting in Jackson Hole, Wyoming, Fed Chair Kevin W. Kash compared to the past he was more direct in explaining the economic outlook, saying that if conditions are appropriate, the Fed would support a rate hike. “We have to be sure that underlying inflation is moving clearly and at a sufficiently fast pace toward our target. If not, then we must take action,” W. Kash said. #美国8月ADP就业创1月来最小增幅 #沙特称伊朗在霍尔木兹袭击其船只
