Global Bond Rout Eases Amid Economic Uncertainty

The global bond market showed signs of stabilization as the U.S. Treasury yields eased slightly. Concerns remain regarding UK bond market volatility amidst economic uncertainty. Market reactions to potential policy changes and fiscal stability continue to impact stock market sentiment globally.

The global bond rout, which has shaken equity markets and strengthened the U.S. dollar, started to ease on Thursday. However, Japanese bond yields reached new highs, and Asian stocks continued to slide early in the trading day. The dollar remained stable amid fluctuating oil prices.

The 10-year U.S. Treasury yield fell to 4.6749%, retracting from its previous peak of 4.73%, the highest since April 2024. Similarly, Japanese bond yields rose to the highest since May 2011 at 1.185%, while Australian yields were last reported at 4.521%. The UK's bond market performance remains a critical factor, with analysts expressing concern over potential economic instability.

Forex markets saw sterling steadying, while the U.S. dollar index hovered near its highest level since November 2022. The resilience of the U.S. economy and persistent inflation pressures have altered market expectations regarding Federal Reserve policy adjustments, adding to global economic uncertainties.

(With inputs from agencies.)