Is this the Santa Rally?
US Mortgage Rates Surged Back Over 7% Today Source: Amy Nixon on X
Money market funds have just hit RECORD levels
Surpassing the $6.5 trillion mark Source: Win Smart
The chart of the day:
France’s benchmark bond yield matched Greece’s for the first time on record, the latest milestone in a week marked by mounting anxiety over the fate of Prime Minister Michel Barnier’s government. The rate on 10-year French notes, traditionally considered among the safest in the euro area, briefly rose to 3.03% before paring the move. That was the same as comparable Greek bonds, a country once at the heart of the European sovereign debt crisis. Investors are concerned that France may struggle to pass a budget for next year, with the far-right National Rally party threatening a no-confidence vote to bring the government down if its demands aren’t met. While French bonds rallied after Finance Minister Antoine Armand said he is prepared to make concessions on the 2025 budget, that did little to dent months of underperformance. “France is not Greece,” said finance minister Antoine Armand. "France has . . . far superior economic and demographic power which means it is not Greece.” Humility at its best... Source: FT, LSEG
French bond premium hits 12-year high as German yields drop amid political uncertainty
Source: PiQ @PiQSuite
Options traders are betting 10-Year Treasury Yields could rise as high as 4.9% in the coming months
Source: Barchart, Bloomberg
CHINA AND JAPAN ARE DUMPING US TREASURIES
Japanese investors sold $61.9 billion of Treasuries in Q3 2024, the most on RECORD. Chinese funds dumped $51.3 billion, the second largest on record. Japan and China are two world's biggest foreign holders of US government debt. Source: Global Markets Investor
Actually, bonds performed really well last week
$TLT $AGG Source: Mike Zaccardi, CFA, CMT, MBA
Foreign holdings of US Treasuries have jumped by $2.6 TRILLION over the last decade.
Europe’s Treasury holdings have risen by $1.5 trillion with the rest of the world acquiring $1.7 trillion of bonds. On the other hand, China and Japan's holdings have shrunk by ~$500 and ~$100 billion, respectively. Overall, total foreign holdings as a share of outstanding federal debt have dropped from 35% to 24%, near the lowest level in 18 years. This is the consequence of rapidly rising public debt with the supply of Treasuries rising ~$15 trillion over the last decade. Foreign demand for Treasuries cannot keep up with skyrocketing US debt. Source: The Kobeissi Letter
