Declined yesterday (2.9.25) US mommyafter a fall in European debt longer, with the performance of the 30 -year bond of USA climb to 5% at the beginning of a historically difficult month for long -term bonds.
Obligations of longer duration bonds climbed approximately three basis pointsnegotiated by the high session, since ISM data on the construction industry showed weakness in overall activity, employment and prices paid. US bonds were re -pressured today (3.9.25), with the 30 -year bond yield increased by one base unit to 4.98%.
The negative climate is also diffused in other markets in Asia. Japan’s 20 -year state -of -the -year yield has risen to the highest level since 1999, while the 10 -year Australian bond yield rose to five basis points to a level last observed in July.
Bond market faces an important week of financial data, including EAugust Employment on Friday, September 5, 2025, which will determine to what extent the US Federal Bank will repeat a widely expected relaxation cycle in September. The pressure exerted on public debt bonds was contributed by the formal corporate debt bid storm after workers’ day, as 27 companies made sales of investment grade.
The vulnerability of global long -term public debt reflects the accumulation of high expenditure, especially after the pandemic, which requires growing sales of funding bonds. As the yield on the 30 -year US bond rose to almost 5%, the British bond reached its highest level since 1998. The corresponding interest rate on French bonds increased by six basis points to 4.51%.
“The bond market tells you, not only here but also everywhere, that he is worried about the course we are in,” Kathy Jones, head of a strategy of strategic income at Charles Schwab & Co., told Bloomberg Television. “The market will continue to invoice a higher premium until we receive some kind of cohesive policy or a signal that the economy is slowing down. We can see this in the employment report. “
The ISM report was “in accordance with weak job market expectations and some future recovery in the future,” said Ed Al-Hussainy, strategic interest rate analyst at Columbia Threadneedle Investment. The government bond market started the month with a somewhat accurate appearance, while “September is historically a bad month for the risk of duration” or exposure to long -term interest rates, he said.
In the last decade, government bonds worldwide over 10 years have recorded average loss of 2% in September, according to data collected by Bloomberg. This is the worst monthly performance of the year.
“Part of this September phenomenon” of the highest long -term yields “has certainly been done in the past and is apparently today with a fairly large amount of corporate publications that will potentially rise to $ 160 billion this month,” Michael Cudzil told Pimo.
The increase in yields on the 30 -year bonds in the United Kingdom and Europe has helped rise to the US reference index just under 5%before buyers appear, with a series of block transactions being carried out on future fulfillment contracts. Transactions included a buyer of 10,000 10 -year bonds, helping to remove returns from the highs of the day around 9am. in New York.
“The 30 -year bonds may simply have little stagnation here for 5%,” said John Briggs, US US Increased Strategy Strategy at North North America. “I don’t think it’s a magic number at all and I have some serious concerns in recent weeks or two about the worldwide long -term bonds.”
Briggs said a decline in US interest rates in high inflation would be “a quite simple recipe for more curves”.
The traders are currently discounting 21 basis points for a 25 -point reduction at the Fed meeting this month, with just over two reductions of 25 points in total being discounted by the end of the year.
The payroll data on Friday, September 5, 2025, will be the latest basic employment report before central bank officials decide whether to reduce interest rates for the first time this year. Governor Christopher Waller said last week that he supports a decrease of one quarter of the percentage point at the September meeting, but added that his view could be changed if this week’s employment report “shows a significantly weakened economy”.
Employment data in August prompted brokers to reinforce politics for loosening, with some at some point entertaining the possibility of a huge reduction by half a unit at the September meeting. Shortly after the report was published, President Donald Trump suddenly fired the head of the office statistics office.
Economists who participated in a Bloomberg survey expect that Friday’s report will show that the US economy added 75,000 jobs in August, with the unemployment rate rising to 4.3%.
“If you get more revisions down and have another weak report, then the market will begin to think about the chance of a reduction by 50 basis points,” Natixis Briggs said.