Global Bond Selloff Deepens as Fed Steps Up Tightening Rhetoric
- Treasury 10-year yields breach bottom of 2018-19 ranges
- Australian benchmark yields jump to highest level since 2015
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This year’s unprecedented global bond rout accelerated after Federal Reserve Governor Lael Brainard said the U.S. central bank will likely step up policy tightening by swiftly reducing its massive debt holdings.
The prospect of aggressive Fed action drove the yield on benchmark 10-year Treasuries up five basis points to 2.60%, propelling it back into ranges seen in 2018 and 2019. The yield spiked as much as 17 basis points on Tuesday. Australian bonds slumped, with 10-year yields climbing as much as 13 basis points to 2.98%, the highest since 2015.