Traders Unwind Rate-Hike Bets as New Covid Fears Spread
- Money markets from U.S. to Europe push back tightening wagers
- New coronavirus strain stokes fears of widespread travel curbs
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Benchmark Treasury yields were on track for the biggest drop since the early months of the pandemic and money markets offloaded bets on central bank interest-rate hikes amid concerns that a new coronavirus strain may spread globally and slow economic growth.
Money-markets pushed back the timing of a first 25-basis-point rate increase by the Federal Reserve to September from June, while briefly pricing out any more hikes unit 2023. The 10-year yield fell as much as 14 basis points, the biggest drop since March 2020 on a closing basis.