Latest News Stream - Government Bond 10y

Brazil’s 10-year government bond yield was little changed around 15.29%, remaining near a decade high after the BCB kept the Selic rate at 13.75% at its November meeting. The decision reflected a outlook marked by weaker growth, higher inflation and heightened uncertainty following President Lula’s reelection. Investors remain focused on fiscal policy, particularly the government’s commitment to controlling spending and public debt, which has risen significantly in recent years. Expectations ahead of the decision were divided, with some investors anticipating a hold and others pricing in a sixth consecutive 25 bps cut. Policymakers cited rising inflation expectations, increased uncertainty and a “more pronounced deceleration” in economic activity. The Copom statement highlighted the slowdown and uncertainty surrounding its own projections. Labor market data further pointed to cooling activity, as Brazil created 121,305 formal jobs in September, below market expectations of 171,000.

Canada's 10-year government bond yield edged lower to around 3.68%, its lowest level in more than two months, tracking a broader decline in global bond yields. The move came amid a broader risk-off sentiment, triggering a renewed global sell-off in technology stocks as investors weighed the potential impact of a Democratic victory in the US on the technology sector and AI-related capital expenditure. Also, the Democrats' gains could strengthen their position in challenging President Trump's trade policies, potentially affecting Canada. Meantime, the BoC delivered its first interest rate hike in more than three years in October, as expected. The BoC signalled that further increases may be necessary to prevent rising energy costs from spilling over into broader inflation. It also raised its 2027 inflation forecast to 3.1%, from 2.0% in July, while upgrading its growth outlook to 1.0%, from 0.7%. Despite the latest rate increase, the policy rate remains below the estimated neutral level.

Germany’s 10-year Bund yield fell below 3.25%, its lowest level since late August, and tracking US Treasury yields as investors sought safety following a sharp sell-off in technology stocks. The rotation out of AI and technology stocks continued today, amid concerns that the Democrats’ victory could bring tighter regulation of US data centres and AI. Meanwhile, their House takeover reduced the likelihood of further deficit-expanding legislation under Trump, easing concerns over US government borrowing. However, rising eurozone inflation and increasingly hawkish rhetoric from ECB policymakers continued to reinforce expectations of tighter monetary policy. Annual eurozone inflation climbed to a fresh 3-year high of 4% in October, largely driven by surging energy prices. Despite leaving interest rates unchanged last week, ECB officials signaled that further hikes may be necessary to contain inflationary pressures and prevent them from feeding through into wages.

France’s 10-year OAT yield fell to 4.7%, its lowest level since September 23, as investors shifted away from technology stocks following the Democratic sweep in the US midterm elections and sought safer assets such as government bonds. Global bond yields also moved lower, tracking declining US Treasury yields, as the Democratic takeover of the House was seen as reducing the likelihood of further deficit-expanding legislation under the Trump administration and easing concerns over US government borrowing. However, persistent concerns over France’s domestic fiscal outlook continued to weigh on French government bonds, limiting the decline in yields. Meanwhile, accelerating eurozone inflation and increasingly hawkish rhetoric from ECB policymakers reinforced expectations of tighter monetary policy. Despite leaving interest rates unchanged last week, ECB officials signaled that further hikes may be necessary to contain inflation and prevent price pressures from feeding into wages.

US 10 Year Government Bond Yield decreased to 4.83%, the lowest since September 2026. Over the past 4 weeks, US 10 Year Note Bond Yield lost 44.10 basis points, and in the last 12 months, it increased 76.00 basis points.

The Swiss 10-year government bond yield fell to around 0.45%, close to its lowest level in just over two months, while markets assess a Democratic takeover of the US congress, which could lead to political gridlock and raised the prospect of fiscal restraint in the US. It could also affect President Trump’s foreign policy agenda, particularly his approach to the war with Iran, while expectations of tighter regulation of the AI buildout lifted safe-haven demand. Further support came from SNB Chairman Schlegel’s remarks, which reinforced expectations that Swiss inflationary pressures remain contained and are largely driven by higher gasoline, diesel and heating oil prices since the outbreak of the US-Iran conflict. Swiss inflation reached a near three-year high of 1.5% in October, also reflecting a weaker franc. The SNB kept its policy rate unchanged at 0%. While markets anticipate a hike in early 2027, economists expect the first increase only in late 2027.

Brazilian long-term yields were set to rise after the BCB kept the Selic rate at 13.75% at its November meeting, remaining near a decade high. The decision reflected a challenging outlook marked by weaker growth, higher inflation and heightened uncertainty following President Lula’s reelection. Investors remain focused on fiscal policy, particularly the government’s commitment to controlling spending and public debt, which has risen significantly in recent years. Expectations ahead of the decision were divided, with some investors anticipating a hold and others pricing in a sixth consecutive 25 bps cut. Policymakers cited rising inflation expectations, increased uncertainty and a “more pronounced deceleration” in economic activity. The Copom statement highlighted the slowdown and uncertainty surrounding its own projections. Labor market data further pointed to cooling activity, as Brazil created 121,305 formal jobs in September, below market expectations of 171,000.

The yield on the US 10-year Treasury note edged higher to 4.9% on Thursday, recovering slightly after falling around 8bps in the previous session. The decline followed the Democratic sweep of Congress in the US midterm elections, which eased some political uncertainty and raised expectations of lower federal spending, tax cuts and a potential diplomatic resolution to the conflict with Iran. Meanwhile, investors are looking ahead to Friday's jobs report for further insight into the health of the US labour market. Recent data showed that private businesses added 86,000 jobs in October, according to the ADP report, while initial jobless claims fell to their lowest level in 57 years. Additionally, third-quarter productivity growth came in stronger than expected. Against this backdrop, markets are pricing in an approximately 83% probability of a 25bps Fed rate hike next month, with a further increase also anticipated in 2027.

The UK 10-year gilt yield pared its earlier decline to trade just below 5.15% after the Bank of England raised its key interest rate by 25 basis points to 4%, marking its first increase in more than three years. Governor Andrew Bailey signaled that further rate increases may be necessary unless the Iran war is resolved, which would help ease the inflationary pressures behind the latest hike. Markets have since strengthened their bets on further monetary tightening, with three additional rate increases now fully priced in by November 2027. The BoE also warned that inflation could peak at 4.9% in Q2 2027, while its adverse scenario points to a sharper increase to 6.2% in Q3. Despite domestic pressure on yields, global bond markets remained supported by falling US Treasury yields following a sweeping Democratic victory in the US midterm elections, while a sell-off in technology stocks prompted investors to seek safer assets such as government bonds.

The UK 10-year gilt yield fell further to around 5.1%, its lowest level since late August, as Brent crude prices tumbled to two-month lows amid expectations that the Trump administration could face mounting political pressure to bring the war with Iran to an end following a Democratic sweep in the US midterm elections. Market sentiment was also supported by a rotation away from technology stocks towards other assets, amid concerns over potential regulatory restrictions on chipmakers. Meanwhile, the Bank of England is widely expected to raise interest rates for the first time since 2023, as persistent inflationary pressures continue to weigh on the economic outlook. However, policymakers may push back against market expectations of further monetary tightening next year. Against this backdrop, expectations for additional rate increases beyond today's BoE meeting have moderated, with traders no longer fully pricing in four rate hikes by the end of next year.

Japan's 10-year government bond yield declined to around 2.75% on Thursday, reaching its lowest level since late July amid a broad global rally in equities and bonds, while falling oil prices eased inflationary concerns. The market movements followed Democratic victories in the US midterm elections, which reduced political uncertainty and lowered the likelihood of President Trump resuming military strikes against Iran. On the domestic front, minutes from the Bank of Japan's September meeting strengthened expectations of further interest rate increases. One board member suggested that the central bank could accelerate monetary tightening as it assessed the effects of Middle East developments, rising AI-related demand, and foreign exchange movements. The BOJ raised its policy rate to a 31-year high of 1.25% in September before keeping it unchanged in October. However, the central bank indicated that underlying inflation had reached its 2% target.

The yield on the US 10-year Treasury note declined to around 4.85% on Thursday, reaching its lowest level in nearly two months as the Democrats' decisive victory in the US midterm elections eased political uncertainty and strengthened demand for both bonds and equities. Meanwhile, artificial intelligence-related stocks faced selling pressure amid concerns over how Democratic control could affect future investments in data-center development. The election outcome also increased expectations of political gridlock in Washington and lowered the likelihood of President Donald Trump resuming military strikes against Iran. This contributed to a sharp drop in oil prices, helping ease inflationary concerns and reducing expectations for further aggressive interest rate increases. Investors are now turning their attention to Friday's closely watched US employment report, while markets currently reflect a 79% probability of a Federal Reserve rate hike in December.

Australia’s 10-year government bond yield fell to around 5.0%, hitting a ten-week low as global equities and bonds rallied, while the Reserve Bank of Australia’s less hawkish policy guidance dampened expectations for further interest rate hikes. Although the central bank raised its cash rate by 25 bps to 4.85% on November 3, the split 6–3 decision, with three policymakers favoring no change, and the removal of explicit language on further tightening pointed to a possible pause in December. Attention now turns to RBA Deputy Governor Andrew Hauser, who is due to speak later today on trust in the transmission of monetary policy and may face questions about the impact of lower oil prices on the policy outlook. Elsewhere, Democratic victories in the US midterm elections, which gave the party control of both chambers of Congress, fueled hopes of progress toward ending the US-Iran conflict. This triggered a sharp decline in oil prices and eased concerns over energy-driven inflation.

Japan 10 Year Government Bond Yield decreased to 2.76%, the lowest since July 2026. Over the past 4 weeks, Japan 10Y Bond Yield lost 34.73 basis points, and in the last 12 months, it increased 107.75 basis points.

The Swiss 10-year sovereign yield fell below 0.5%, reaching its lowest level in just over two months, while markets assess a Democratic takeover of the US congress, which could lead to political gridlock and raised the prospect of fiscal restraint in the US. It could also affect President Trump’s foreign policy agenda, particularly his approach to the war with Iran. However, signs of persistent inflationary pressures limited gains. In Switzerland, inflation climbed to a nearly three-year high of 1.5% in October, driven by a weaker franc and higher energy prices. While still within the SNB’s 0%-2% target range, inflation moved closer to its upper limit. The SNB kept its policy rate at 0%, with Chair Schlegel signalling no immediate need for a change. While markets expect a hike in early 2027, economists anticipate a move only in late 2027 as core inflation remained steady at 0.5%.

Germany’s 10-year Bund yield fell below 3.3%, touching its lowest level since late August and tracking a decline in US Treasury yields following an unexpected Democratic sweep in the US midterm elections. The Democrats’ takeover of the House and Senat is seen as reducing the likelihood of further deficit-expanding legislation under the Trump administration, easing concerns about government borrowing. However, the decline in German yields was more modest than across other European bond markets, as new data pointed to persistent inflationary pressures, reinforcing expectations that further rate increases may be necessary. Eurozone annual inflation accelerated to 4% in October, its highest since September 2023 and well above the ECB’s 2% target, largely driven by surging energy prices. Despite last week’s decision to leave rates unchanged, officials signalled that further increases may be needed to contain inflation and prevent price pressures from spilling over into wages.