Global Markets     In December, the UST yield curve steepened with yields from the belly until the long-end rising amid the strong run in riskier markets. The stronger risk appetite was fuelled by the gradual distribution of vaccines across the US and the passing of the USD900 billion COVID-19 aid bill. Meanwhile, short-end yields were anchored by the Fed’s commitment to asset pur...

Global Markets     USTs were in demand in November despite several COVID-19 vaccine breakthroughs and Joe Biden’s US presidential election victory. Demand was buoyed by uncertainty surrounding the ongoing US fiscal stimulus deadlock and additional stimulus by the Fed. In Europe, peripheral government bond yields (Spain, Portugal, Italy and Greece) fell while yields in France and G...

Global Markets     UST yields surged in a steepening bias in October on hopes of fresh new fiscal stimulus as polls indicated the possibility of a Democrat sweep in the US Presidential Election. Yields were also up on positive US economic data releases over the month. The 10y UST was last quoted at 0.88% (Sep: 0.69%). In the euro zone, government bonds rallied amid continued resurge...

Global Markets     Yields on govvies from developed nations continued to fall in September amid a spike in COVID-19 infections, US election uncertainty and prolonged periods of low interest rates. Demand was also driven by: 1) the Fed’s pledge to maintain its FFR target range at 0.0% to 0.25%; 2) negative inflation in the euro zone; and 3) the BOE’s interest to explore negative ...

Global Market     Government bond yields in developed markets bear-steepened significantly in August following the US Fed’s decision to allow inflation to run above its 2% target during the Annual Jackson Hole Symposium. This had led to fears of rising inflationary pressure. Better-than-expected economic data and positive news about the development of a COVID-19 vaccine have also ...

Global Markets     In the US, GDP had contracted by 9.5% y-o-y in 2Q2020, the deepest decline recorded. This was mainly due to the sharp contraction in consumer spending as a result of the US government lockdown. On the monetary front, the Fed left its FFR unchanged and affirmed its dovish stance. The euro zone’s GDP also contracted in 2Q2020 by 15.0% y-o-y which exceeded the USâ€...

Global Markets     In the US, PCE eased for the third consecutive month in May due to the continuing decline in purchases of durable and non-durable goods. In contrast, US retail sales rebounded in June after posting a decline for three consecutive months since March. In Europe, GDP projections were downgraded to -8.7% in 2020 and 6.1% in 2021 as the lifting of lockdown measures in ...

Global Markets     In the US, the unemployment rate hit an all-time high of 14.7% in April and moderated to 13.3% in May. The contraction in the manufacturing PMI remains severe for the second consecutive month in May amid weak demand and poor economic sentiment. In Europe, the German Constitutional Court struck a blow to ECB by declaring the massive PEPP as ultra vires and cited ne...

Global Markets     The 1Q2020 US real GDP expanded at its slowest pace since the GFC by 0.5% as the COVID-19 outbreak took a toll on the economy. Last month, the US recorded the largest number of COVID-19-related cases and deaths in the world. In Europe, PMI for the manufacturing sector slumped to more than a decade low as non-essential businesses were either shuttered or face...

Global Markets     The worsening COVID-19 pandemic has resulted in governments restricting the movement of its citizens to contain the spread of infection. Policymakers also unveiled large-scale stimulus measures to cushion the economic impact of the pandemic. In the US, the Fed introduced broad QE programmes with unlimited commitment to purchase USTs and MBS. In Europe, the ECB ann...