Developed World Bond Yields Plunge To Record Lows

With the plunge in rate-hike odds and fears over Brexit, it appears the safety of global developed market bonds is sought after as Bloomberg's Developed World Bond yield slumps to just 62bps - a record low. Yields are moving opposite to what economist expected (and have been expecting since the fall of 2011 when Ben Bernanke broke the capital markets).

Record low global bond yields...

 

As Bloomberg reports, investors are seeking the relative safety of bonds as central banks struggle to spur economic growth and inflation.

Policy makers in Europe and Japan are pursuing record stimulus programs, and traders are scaling back forecasts for when the Federal Reserve will raise interest rates.

 

“The probability of a hike in June has decreased,” said Wontark Doh, the head of overseas fixed-income investment in Seoul at Samsung Asset Management Co., which oversees $200 billion. “Treasuries rallied. Demand will persist. That has an effect on all other countries.”

10Y US Treasury yields are trading at 1.73% today - for context, a Bloomberg survey at the end of last year projected the figure would rise to 2.55 percent by June 30...

 

Ahead of Asia's open tonight, we note that Australian 10-year yields fell to an all-time low of 2.15 percent and Japan’s slid to minus 0.125 percent, approaching the record of minus 0.135 percent.