An overview of the bond bloodbath
US 10s are taking a hit but it’s nowhere near the pain in the periphery and the UK.
- UK 10-year yields up 17 bps to 2.57% — highest since 2011
- France 10-year yields up 14 bps — highest since July 2012
- Italy 10s up 21 bps — highest since March
- Spain 10s up 21bps — highest since March
- Portugal 10s up 35 bps — highest since January
- Canada 10s up 9 bps — highest since 2011
It’s an absolute rout around the globe. The question is: where is the money going? The short end of the curve is also selling off and so are stocks. At some point that money needs to find a home.
You can also be sure that central banks in struggling economies — ahem the UK — will not be pleased to see borrowing costs rising. This increases the chance of Carney making dovish moves at the BOE.