Global bond sell-off intensifies amid US rate rise expectations

Summarised from 5 outlets · 13 reports · Updated 25 Sept, 23:03 · Archive

US Treasury yields have surged to their highest level since 2007, with markets expecting further Federal Reserve rate rises.

A global bond sell-off has intensified as financial markets increasingly expect the US Federal Reserve to raise interest rates further this year. The yield on ten-year Treasury bonds has climbed to more than 5.13%, the highest since 2007, with one outlet reporting a 55% probability of at least two quarter-point rate rises by the end of December. The sell-off reflects investor concerns about persistent inflation and the strength of the US economy. Japanese government bond yields have also hit new highs as the sell-off spreads globally. However, some investors see rising yields as an opportunity to purchase bonds, and some market participants suggest that higher borrowing costs have not yet slowed US economic activity.

How it is being reported

• Soaring bond yields ‘not even close’ to cooling red-hot US economy, investors sayRising borrowing costs so far show no sign of putting a brake on activity in world’s biggest economyFinancial Times · 25 Sept, 21:00
• 10-year Treasury yield hit a 19-year high—and some investors see opportunity to buy bondsThe 10-year Treasury yield hit its highest level since 2007. Here’s what higher yields can mean for bond investors and borrowers.CNBC · 25 Sept, 17:40
• U.S. Treasury yields tick higher as global bond rout slowsU.S. Treasury yields continued to climb higher to end the week following a global bond selloff and stronger-than-expected U.S. economic data.CNBC · 25 Sept, 09:08
• Japanese government bond yields hit new high as global sell-off continuesSharp increase in interest rate expectations across advanced economies, says Capital EconomicsFinancial Times · 25 Sept, 06:41
• Surging Treasury yields pose a brand new problem for Kevin Warsh and the FedMarkets expect the central bank will take a firmer hand on inflation. It's not that easy.CNBC · 24 Sept, 22:40
• History shows financial calamities occur when rates rise rapidly like this: 'Something always breaks'The 10-year Treasury note yield is spiking to levels not seen in years, and that may be a bad omen for financial markets.CNBC · 24 Sept, 21:57
• US long-term borrowing costs touch highest level since 2004Rising yields strain public finances after brutal sell-off in US Treasuries marketFinancial Times · 24 Sept, 21:32
• 30-year Treasury yield hits highest level since 2004 as bond market rout continuesU.S. Treasury yields continued their upward momentum after hitting a 19-year high on Wednesday.CNBC · 24 Sept, 21:25
• Why the bond market is freaking out, and what it means for your moneyInvestors are increasingly nervous about rising inflation, which could require the Federal Reserve to hike interest rates.CBS News · 24 Sept, 20:08
• Analysis: Higher Treasury yields deliver a reality check on a hot, inflation-prone economyElevated Treasury yields will complicate both Federal Reserve policy and Treasury financing.CNBC · 24 Sept, 19:38
• Rising Treasury yields could push car loan rates higher, experts say. What buyers need to knowBond yields have spiked due to expectations of persistent inflation and further interest rate hikes from the Federal Reserve, which may impact auto loan rates.CNBC · 24 Sept, 18:45
• US bond yields soar most since Trump's tariff shock amid fears of Fed is set for another rate hikeThe yield on ten-year Treasury bonds - the world's benchmark financial asset - soared from 4.97% to more than 5.13%, the highest since 2007.This is Money · 24 Sept, 07:40
• Global bond sell-off deepens amid fears US economy may be running too hot – business liveRolling coverage of the latest economic and financial news Financial markets are now much more confident that the US Federal Reserve will raise interest rates rates at least one more time this year. According to CME Fedwatch , there’s now a 55% chance that US rates are half a percentage point higher by the end of December – implying two quarter-point rate rises (or one beefy hike!). That’s on top of the Fed’s hike earlier this month. The main story is still the huge global bond selloff, with yesterday seeing the biggest jump in the 10yr Treasury yield (+15.2bps) since the market turmoil…The Guardian · 24 Sept, 07:22

In this story: Federal Reserve · US Treasury · Japan · United States

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