We recommend Peter Boockvar’s May 15 summary. Here’s an excerpt:
Today the fresh 29 yr high in the 10 yr JGB yield finally matters? Today the fresh 18 yr high in the 10 yr UK gilt yield finally matters? Today the fresh 15 yr high in the 10 yr German bund yield finally matters? Today, the above 4.50% 10 yr note yield and a 30 yr 5.09% bond yield now matters? Only the most important input in the multiples of everything is interest rates after all.
See his Substack post here, as he maps long-end bond yields in four charts: the 10-yr JGB, the 10-yr UK gilt, the German 10-year, and the 10-yr US Treasury bond:
“So now people finally care?” | Boock Report on Substack,
https://peterboockvar.substack.com/p/so-now-people-finally-care
Charles-Henry Monchau, CIO at the Syz Group, adds the Italy 10-year and France 10-year yield to the mix in a May 17 LinkedIn post:
Bond markets are reacting to the rising prices that make up the deteriorating inflation outlook. TLT, the 20+ year Treasury bond ETF, dramatically demonstrates that as bond yields rise worldwide, bond prices fall.
This coming Sunday, May 24, we will dig deeper into the inflation outlook for the US and explain why we are expecting inflation rates of 4%–5% for the rest of this year. That outlook suggests that the present Federal Reserve policy interest rate is too low. New Fed Chair Kevin Warsh takes over from Jay Powell in the face of a firestorm that didn’t exist when his appointment was announced by President Trump.
Trump has zero history of supporting higher interest rates and years of history wanting and pushing for lower interest rates. He has been a borrower for decades, and there’s no expectation he will change his opinion. Will an independent Fed do the right thing and not lower interest rates? Or will Warsh succumb to political pressure? IMO, any Fed easing will only validate the inflation and make it worse while sending bond prices down and bond yields even higher than they will otherwise be.
Tune in Sunday for the details.
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