Bond Rally Gains Momentum as Traders See Rates Close to Peak
- Slowing US inflation spurs repricing in outlook for rates
- Yields on short-end Treasuries, German bonds and gilts tumble
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Bonds rallied for a second day as traders bet an aggressive streak of global interest-rate hikes is close to ending, bolstered by optimism inflation in the world’s biggest economy will continue to slow.
Short-dated bonds led the advance with two-year US Treasury yields falling as much as 14 basis points to 4.61%, the lowest level in nearly a month. The rate on similarly-dated UK securities also fell, taking a drop over the past two days to nearly 30 basis points, the biggest since March. Meanwhile, benchmark US 10-year US Treasury yields were down about 9 basis points to 3.77%.