German Bonds Halt Slide After Brainard Stokes Cheap-Money Wagers
- There’s now a less than 1-in-4 chance of September Fed hike
- Bund yields are down from highest since Brexit result
This article is for subscribers only.
German 10-year bunds halted a three-day decline after Federal Reserve Governor Lael Brainard’s dovish comments encouraged traders to pare bets on an imminent U.S. interest-rate increase.
Benchmark bund yields were little changed after earlier falling to zero percent, down from the highest since the Brexit vote in June. That was after Brainard, speaking in Chicago on Monday, cautioned “prudence” in tightening policy. This led investors to wonder whether global policy makers will, after all, keep open the supply of bond-boosting cheap money -- days after the European Central Bank sent securities tumbling by failing to expand quantitative easing.