Global Bond Market Sees Sharp Selloff Amid Inflation Fears
The global bond market is experiencing a sharp selloff as investors assess higher energy prices and inflation risks. Short-term US and euro zone yields have risen to multi-year highs, while 30-year yields across major markets are hovering around levels not seen in over a decade.
The U.S. Treasury is preparing to at least double its longer-dated bond buybacks, with the first operation scheduled for Wednesday. This move aims to stabilize the market and reduce borrowing costs.
Japan's 10-year government bond yield has climbed above 3% for the first time in three decades, making it a key focus for global bond markets. The Bank of Japan's rate outlook and government borrowing plans are under scrutiny.
The US inflation calendar takes center stage this week with producer prices due Thursday, followed by the closely watched consumer price index on Friday. Economists polled by Reuters expect August CPI to rise 0.4%, which could influence the Federal Reserve's decision on interest rates at its September 15-16 meeting.