Bond Yields - Daily Sketch

uk.investing.com/analysis/bond-yields--daily-sketch-200457174

By Jeroen Blokland | Feb 16, 2021 09:53

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Today’s Daily Sketch is again devoted to the outlook for bond yields. A couple of days ago I pointed out that the yield curve could steepen further. Today’s chart shows the nominal US 10-Year Treasury rate and the 10-year breakeven inflation rate, generally seen as one of the most reliable market-based measures of expected inflation. The gap between the two has grown historically large. And while nominal bond yields are kept artificially low by massive Federal Reserve bond buying, my guess is that the black line will (slowly) move towards the blue line and not the other way around. Not in the least because ongoing fiscal stimulus aimed at boosting the real economy should have a longer-lasting upward effect on inflation. Hence, remain underweight duration for now.

US Nominal Yield Vs Breakeven Rate

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Central Banks

Interest Rates

Next Meeting

BOE

0.10%

Dec 16, 2021

ECB

0.00%

Dec 16, 2021

FED

0.00%-0.25%

Dec 15, 2021

SNB

-0.75%

Dec 16, 2021

RBA

0.10%

Dec 07, 2021

BOC

0.25%

Dec 08, 2021

RBNZ

0.75%

Nov 24, 2021

BOJ

-0.10%

Dec 17, 2021

CBR

7.50%

Dec 17, 2021

RBI

4.00%

Dec 08, 2021

PBOC

3.85%

BCB

7.75%

Dec 08, 2021

FTSE 100	7,044.03	-266.34	-3.64%
DAX	15,257.04	-660.94	-4.15%
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Brent Oil	72.91	-9.31	-11.32%
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Copper	4.2790	-0.1585	-3.57%
London Cocoa	1,626.00	-55.00	-3.27%
London Wheat	231.70	-2.90	-1.24%

GBP/USD	1.3339	+0.0019	+0.14%
EUR/USD	1.1319	+0.0113	+1.01%
USD/JPY	113.31	-2.05	-1.77%
EUR/GBP	0.8486	+0.0076	+0.90%
USD/CAD	1.2789	+0.0141	+1.12%
GBP/JPY	151.13	-2.53	-1.64%
AUD/USD	0.7125	-0.0065	-0.90%

Lloyds Banking	46.00	-3.68	-7.42%
Vodafone Group PLC	109.62	-4.48	-3.93%
Barclays	181.66	-13.84	-7.08%
BT Group	154.00	-6.85	-4.26%
HSBC	414.05	-29.75	-6.70%
BHP Group	1,962.00	-48.00	-2.39%
Exxon Mobil	61.25	-2.23	-3.51%

Bond Yields - Daily Sketch

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