The Week Ahead: The tempest in Treasuries

Economics Reports

The tempest in Treasuries

The past two weeks have seen an extremely stormy Treasuries market, but only one of two swings that largely offset each other generated a flood of “end of the world as we know it” commentaries. Nobody saw anything amiss in a sudden rally that saw 10-year rates dive by nearly 40 bps in six days, dropping below 4% on April 4th. But there was much wailing and finger pointing when they reversed course and closed near 4.5% in a few days. In that finger pointing, a squeeze on repo funding for leveraged bond holders, forced selling by those losing money on equities, or bond dumping by China and other countries dismayed by US tariffs were all cited as reasons, with no supporting evidence.

Read more in the detailed report below.

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