Asian Shares Plummet as Bond Volatility Intensifies Ahead of US Jobs Data
Asian shares fell on Friday as investors struggled to cope with intense fluctuations in bond and currency markets ahead of crucial US jobs data. The benchmark 10-year US Treasury yields touched their highest level since 2002 at 5.34% before retreating, while the spread between French and German sovereign bond yields widened to a 14-year high.
The euro sank against the dollar, yen, and Swiss franc, with the single currency hitting its lowest point since May 2025 at $1.1215. Meanwhile, oil prices remained firm due to escalating tensions in the Middle East, with US West Texas Intermediate crude futures steady at $92.84 a barrel.
Markets are bracing for the release of US nonfarm payrolls later in the day, with forecasts pointing to a 90,000 jobs increase in September and an unchanged employment rate of 4.1%. Analysts warn that a strong wages print could have significant implications for US rates, Treasuries, and the dollar.
Despite some buyers returning to the market, term premium concerns remain, with investors pricing in a 25% probability of another Fed interest rate hike in October, down from 69% just a week ago.