Global bond market’s making a move again - SocGen

Kit Juckes, Research Analyst at Societe Generale, notes that the bond market’s making a move again, with yields up significantly in recent days.

Key Quotes

“The bond market is driving currency trends, not the other way around, so if what we’re seeing is a break in recent choppy trading and a revived bear market (personally, i think that’s the case, driven by rising inflation, and triggered by the break higher in equities) it’s significant. As well as the break higher in yields however there are two other points to note. Firstly, the real yield move is smaller so far – 10year nominal yields are up 5bp over the last week but real yields are up half as much. And secondly, it’s not all good news for the dollar because that 5bp rise in US yields over the last week is half of the 10bp move in Bunds, and is also smaller than the moves in the UK and Canada. The laggard among G10 countries is Japan, where BOJ policy still anchors 10year yields which Are up 1.5bp over the last week.”