Bond Selloff Deepens as Energy Surge Fuels Rate Hike Bets

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Summary · why it matters

A new wave of strikes in the Iran war has sent energy prices surging, intensifying a global bond market selloff as investors brace for central bank rate hikes this month. U.S. 10-year Treasury yields hit their highest since 2023 at 4.8%, approaching the 5% level seen as a major challenge for equities. With rate rises now odds-on at the Federal Reserve, European Central Bank, and Bank of Japan, nervousness prevails. New Zealand's Reserve Bank became the first central bank to hike this month with its second consecutive rise, but dovish signals knocked the kiwi dollar. Rising energy costs add to budgetary and political pressures ahead of key budgets in Britain and France, German state elections, and U.S. midterms. Attention turns to U.S. labor data, while Dell and Palo Alto Networks beat estimates, and Broadcom reports later.

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