August Chaos Has U.S. Treasury Returns Set for Post-Crisis Highs
- Bloomberg Barclays benchmark poised for biggest gain since ‘08
- Trade, Brexit, Hong Kong could drive further outperformance
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A chaotic month of trade warfare, recession fears and broadening political turmoil has set U.S. government bonds on track for their strongest monthly return since the heat of the 2008 crisis.
With just one more session to go until August’s market turmoil can be fully accounted for, the Bloomberg Barclays U.S. Treasury index has gained 3.33%, more than in any month since December 2008. It returned 3.39% that month as the Federal Reserve slashed interest rates by a further 75 basis points to stabilize the economy following the collapse of Lehman Brothers. The U.S. 10-year yield plummeted 71 basis points over the month, to 2.21%.