Government bond yields are pressuring everything, from home loans to equities
The post Government bond yields are pressuring everything, from home loans to equities appeared on BitcoinEthereumNews.com. Government bond yields are tearing through everything right now. Homeowners, stock traders, governments; no one’s getting out of this untouched. What started as a slow change in borrowing costs has now turned into what analysts at Deutsche Bank are calling a “slow-moving vicious circle.” They’re not wrong. Governments, from the U.S. to the U.K., France, and Japan, are all struggling with rising interest payments on massive deficits. When investors start doubting whether these countries can handle their debt, they demand more compensation to lend. That pushes bond yields even higher, which makes those debts worse. Rinse and repeat. Yields spike and home loans feel the hit By midweek, the 30-year U.S. Treasury jumped past 5%, the highest since July. In Japan, their 30-year bond hit a new record. The U.K.’s 30-year spiked to its highest level in 27 years. Even though yields eased slightly on Thursday and Friday, they’re still way above pre-2020 levels. The bigger issue? These high borrowing costs are sticking around. “Cooler heads will prevail, and markets will function as they should,” said Jonathan Mondillo, global head of fixed income at Aberdeen. But let’s not pretend this volatility is normal. Yields move in the opposite direction of bond prices, and this kind of price action means markets are nervous. Really nervous. Mortgage rates are feeling the heat. The 30-year Treasury yield directly impacts the 30-year mortgage, still the most popular home loan in the U.S. When that yield spikes, monthly payments go up fast. “That’s concerning,” said W1M Fund Manager James Carter. He pointed to rising long-term yields and said, flat out, “this is not going to help mortgage holders.” Yes, Trump’s pressure might lead to short-term rate cuts, and weaker job data already has Fed officials preparing for that. Carter called that “counterintuitive” and warned it…
The post Government bond yields are pressuring everything, from home loans to equities appeared on BitcoinEthereumNews.com.
Government bond yields are tearing through everything right now. Homeowners, stock traders, governments; no one’s getting out of this untouched. What started as a slow change in borrowing costs has now turned into what analysts at Deutsche Bank are calling a “slow-moving vicious circle.” They’re not wrong. Governments, from the U.S. to the U.K., France, and Japan, are all struggling with rising interest payments on massive deficits. When investors start doubting whether these countries can handle their debt, they demand more compensation to lend. That pushes bond yields even higher, which makes those debts worse. Rinse and repeat. Yields spike and home loans feel the hit By midweek, the 30-year U.S. Treasury jumped past 5%, the highest since July. In Japan, their 30-year bond hit a new record. The U.K.’s 30-year spiked to its highest level in 27 years. Even though yields eased slightly on Thursday and Friday, they’re still way above pre-2020 levels. The bigger issue? These high borrowing costs are sticking around. “Cooler heads will prevail, and markets will function as they should,” said Jonathan Mondillo, global head of fixed income at Aberdeen. But let’s not pretend this volatility is normal. Yields move in the opposite direction of bond prices, and this kind of price action means markets are nervous. Really nervous. Mortgage rates are feeling the heat. The 30-year Treasury yield directly impacts the 30-year mortgage, still the most popular home loan in the U.S. When that yield spikes, monthly payments go up fast. “That’s concerning,” said W1M Fund Manager James Carter. He pointed to rising long-term yields and said, flat out, “this is not going to help mortgage holders.” Yes, Trump’s pressure might lead to short-term rate cuts, and weaker job data already has Fed officials preparing for that. Carter called that “counterintuitive” and warned it…
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