Interesting point of view by Otavio Costa on the rise of global yields relative to us yields
He sees it as a real-time “Mar-a-Lago Accord" (i.e dollar devaluation). Here's why: "The strategy of letting global yields rise relative to US yields is central to weakening the dollar. What some see as a market shift might be a policy, a clear move toward dollar devaluation. The implications extend further, especially for emerging markets, which stand to benefit significantly from this environment". Your view? Source: Crescat Capital, Bloomberg
$TLT jumps to highest price since April 📈📈📈 Ready to breakout?
Source: Barchart
As Fed rate cuts odds increase, stocks and bonds continue to be bid together...
Source: www.zerohedge.com, Bloomberg
"The Ukraine war and the weaponization of the dollar was the straw that broke the camel's back"
Source: zerohedge
As highlighted by Otavio Costa, this is the environment we are in:
US 2-year yields approach multi year lows as commodities approach all time highs. The Fed is likely to cut rates to service debt. And the price to pay inflation expected to run hotter. Source: Tavi Costa, Bloomberg
Gold knows
Gold is following the Japanese 30 year, pricing in "spillover" risks... Source: TME, LSEG workspace
This is Bloomberg's measure of bond market liquidity, which compares actual yield curves to synthetic smooth yield curves for each country
The more kinks you have in the yield curve, the higher this index and the worse is liquidity. UK off the charts, France rising rapidly... Source: Robin Brooks
The UK faces the doom loop of rising borrowing costs, growing deficits and a government facing a lot of bad choices to raise revenues
Yields on 30-year gilts have reached their highest levels since 1998. Source: Lisa Abramowicz @lisaabramowicz1, Bloomberg
