The sell-off that’s hit the bond market in recent weeks isn’t just a US phenomenon — in fact, it’s even more pronounced in other countries this year.
Bond investors globally seem jittery, in part due to concerns about deficit spending and fears that governments will continue to spiral deeper into debt.
This was on display this week when key US bond yields jumped as politicians debated a sweeping budget bill that economists think could add trillions to the US deficit.
The 10-year Treasury yield spiked as high as 4.61% this week, up 63 basis points from its low in early April. The 30-year Treasury yield climbed as high as 5.13%. That’s up 74 basis points from its April low and 31 basis points from the start of the year.
However, the 10-year Treasury is nearly flat for the year despite recent gyrations, and observers should look globally to get a better sense of the bond market’s situation.
