The Bond Bloodbath Is Back: US, Chinese Yields Soaring

Following the worst month for risk-parity funds since 2015, we suspect month-end redemptions are driving both stocks and bonds (4x levered on average) lower out of the gate in November. Extending yesterday's losses, US Treasury yields are explding higher once again (long-end underperforming) following China's bond market's biggest yield spike in years overnight.

China bond yields hit 2016 highs overnight as the liquidity crisis grows...

 

But the long-end of the UST curve is now up 15bps from yesterday's lows...

 

Notably, the 10Y Yield is now just 15bps away from Goldman Sachs' "equity-worrying levels"