What Led To Such A Frenzied Bond Market?

On Friday, the bond market hit a new record. In addition to the negative yield of Japanese and German bonds, the yield of US Treasury bonds was also low. In 30, long debt hit a new low of at least 60 years.

Analysts believe that the United States debt suffered mainly from Europe's panic buying, the British withdrawal from Europe to help the Bank of England may cut interest rates this summer, the European Central Bank may relax the QE purchase standards are pushing hands.

On Friday, in addition to the continued low yields of Japanese, British and German bonds, the 10 and 30 year yields in the US also set the lowest record respectively, with the former falling 1.38% and the latter falling to 2.189%. The Bank of America and Merrill Lynch data show that this is the lowest level of long-term treasury bond yields since 1950s.

Institutional broker

Andrew Brenner, head of international fixed income, believes that the price rises in the US are driven by buyers from Europe, and partly from Asian buyers. They start off at 2 a.m. on Friday at 10 a.m. and 30 years.

"This is a panic buying," he said. "Panic is like a skeleton reaction."

He also said that there were not many people on the market in New York on Friday, so the impact of these panic buying would be magnified.

CNBC reported that the US Treasury buying climax on Friday was influenced by Carney, the governor of the Bank of England.

Carney hinted on Thursday that the Bank of England could take monetary easing this summer.

He said,

In the coming months, the Bank of England will have to relax its policy to deal with the prospect of Britain's retreat from Europe.

George Goncalves, an interest rate strategist at Nomura, said that 1.25% or 1.30% is a reasonable level of stabilization for the 10 year US debt yield, and 1.15% is the level of analyst attention.

If you want to fall below 1%, you need to

In the environment, or people are really worried about falling into recession.

And the next economic event that may cause US Treasury yields to record lows may be the US non farm employment report released next Friday.

The number of new non farm workers in May was only 38 thousand, far below the expected 160 thousand, the lowest in nearly six years.

That is, after the announcement of the non farm employment data, the market's expectation of the Fed's rate hike in June dropped to freezing point.

After the announcement of the referendum on Britain's withdrawal from Europe last Friday, the global bond market was ushered in by hedge investors. Japan's multi period yields were all at a record low, and Germany's 10 year period also fell to a negative value.

Yesterday, the Wall Street article noted that because of the news of the European Central Bank's relaxation of the purchase of debt standards this week, some investors believe that the sovereign debt of the European periphery countries will benefit from it.

Affected by this, the yield of treasury bonds across the world has declined.

CNBC reported that the US 10 year treasury bond, which fell to 1.44% on Friday, has now seen a channel formed by the us no longer raising interest rates in 2006, pointing to an important support 1.15%.

In the interview with Fox Business Network on Monday, Grosse, the king of bond, predicted that the yield of us 10 - year treasury bonds might even fall to 1.25%, even though it is still attractive compared with Germany's negative yield bonds with Japan.