Bonds

Our Economists Recommend

The latest key insight, in-depth analysis and thematic research collections

Bonds Focus

Will Treasury bulls be able to face down the bond vigilantes?

Our central forecast is that there won’t be a fiscally induced ‘crisis’ in the Treasury market. But there is clearly a risk of yields rising in response to higher term premia and more restrictive...

25th October 2024 17 mins read

Global Markets Focus

Final thoughts on the US election & market implications

While the perceived probability of a Trump win has increased over recent weeks, we believe there is still ample scope for a sizeable repricing across markets once the election outcome becomes clear...

28th October 2024 14 mins read

Bonds Focus

What to make of shrinking IG credit spreads

Despite being around multi-decade lows, we think credit spreads of US investment-grade corporate bonds could fall further still over the next year or so.

12th December 2024 11 mins read

Asset Allocation Chart Pack

Interactive Markets Chart Pack

This new interactive Markets Chart Pack combines our previous Global Markets, Asset Allocation, and FX Markets Chart Packs to give you a more comprehensive and timely view of the latest developments...

14th January 2025 1 min read

We see scope for Treasury yields to pick up a bit more, while other DM yields fall

We forecast long-term Treasury yields to edge up a bit, even as the Fed’s easing cycle continues, on the back of Trump’s fiscal and protectionist proposals, which point to stronger inflationary pressures in the US. But we expect sovereign bond yields in most other developed markets to fall from now to end-2025 as domestic policy rates are cut further than is implied in money markets. We expect the biggest falls in yields in the UK, in Canada and in New Zealand.

That view translates into corporate bond yields picking up slightly in the US and falling in the UK and the euro-zone, as we see already compressed staying close to their current levels.

And, although emerging markets are a mixed bag, we think local-currency sovereign bond yields in most places will generally fall by the end of next year as the EM easing cycle broadens on aggregate. Meanwhile, we expect the yields of dollar-denominated sovereign bonds to pick up a bit.