Yeah, so the cacophony of hawkish commentary from central bankers has triggered a global selloff in government bonds.
As noted earlier, bund yields are higher by goddamn 20bps since Monday – and that’s a lot considering the starting point (25bps).
Treasuries are being sold (that’s three straight days), gilt yields are higher (Carney comments), etc. etc.
You’ll note that USTs came under quite a bit of pressure about an hour ago, as 10Y and 30Y futs slid below Wednesday’s lows as volumes surged with ~100k TYU7 contracts traded in the move from 125-31 to a session low 125-19+. That drug the rest of the curve lower.
Here’s a little more color on that move from Bloomberg:
- Move lower initially triggered as 10Y futures breached 125-28; it was extended as contract also breached 50-DMA at 125-27+ and 10Y yield moved back above 50-day trendline at 2.246%
- Curve flattened in selloff with 5s30s dropping from 97bp to 95.5bp over a few minutes as 5Y yield approached 1.88%
- Treasury weakness widened U.S.-German 10Y spread back through 184bp, with German 10Y cheaper by just 1.5bp on the session
And here’s a snapshot of global moves: