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☆ Forget Core CPI, Market Pros Are Searching for Supercore Inflation
▼ + stars: | 2023-01-12 | by ( Sam Goldfarb | ) www.wsj.com time to read: 1 min

Prices of services are rising quickly. Prices of goods are falling. Policy makers and market watchers already strip out volatile components of price indexes to understand what is known as core inflation. These days, many are on the hunt for an even narrower measure: a supercore. When the Labor Department releases its latest inflation reading on Thursday, most investors will still look first at the monthly change in the so-called core consumer-price index, which excludes food and energy categories to provide a better sense of inflation’s longer-term trajectory.

☆ Bonds Open 2023 With a Rally
▼ + stars: | 2023-01-09 | by ( Sam Goldfarb | Matt Grossman | ) www.wsj.com time to read: 1 min

U.S. Treasurys are off to a solid start in 2023, providing a glimmer of hope to investors recovering from a historically terrible year for bonds. Treasury yields, which fall when bond prices rise, logged sizable declines in the first week of the year. The moves were aided first by encouraging inflation readings in Europe, and then by separate U.S. economic reports on Friday that showed a smaller-than-expected increase in average hourly earnings for workers and a surprisingly soft reading on service-sector activity.

☆ For Battered Bonds, Threats of Further Losses Linger
▼ + stars: | 2023-01-02 | by ( Sam Goldfarb | ) www.wsj.com time to read: 1 min

The year 2022 marked a truly historic bust for the U.S. bond market. The question now is whether 2023 will produce any kind of meaningful rebound. Normally a safe investment, U.S. bonds delivered losses over the past 12 months that far exceeded anything investors have seen in their careers. The Bloomberg U.S. Aggregate bond index dropped 13%, easily outdoing its previous worst year in data going back to the 1970s, when it declined 2.9% in 1994.

☆ Treasury Rally to Be Tested by Fed’s Next Move
▼ + stars: | 2022-12-19 | by ( Sam Goldfarb | Matt Grossman | ) www.wsj.com time to read: 1 min

Federal Reserve Chairman Jerome Powell has indicated the central bank might raise interest rates by 0.25 percentage point at its next meeting. U.S. government bonds have continued to rally after a wretched first 10 months of 2022, reflecting Wall Street’s optimism that inflation will be controlled sooner rather than later. Treasury yields, which fall when prices rise, fell last week after a better-than-expected consumer-price-index report. They then maintained those levels after the Federal Reserve’s last policy meeting of the year, which contributed to mounting recession fears among stock investors but did little to alter interest-rate bets in the bond market.

☆ Bond Rally Drags 10-Year Treasury Yield Back Down to 3.5%
▼ + stars: | 2022-12-05 | by ( Sam Goldfarb | ) www.wsj.com time to read: 1 min

Hopes that inflation is easing have driven a weekslong rally in government bonds, pulling the 10-year U.S. Treasury yield back to 3.5% for the first time since September. Treasurys started rallying with stocks after the Labor Department released better-than-expected consumer-price index data on Nov. 10. That move was supercharged last week when Federal Reserve Chairman Jerome Powell sent the clearest signal yet that the central bank plans to raise short-term interest rates by half a percentage point at its Dec. 13-14 meeting, a step down from the 0.75 percentage point increases of the past four meetings.

☆ Yield Curve Inversion Reaches New Extremes
▼ + stars: | 2022-11-29 | by ( Sam Goldfarb | ) www.wsj.com time to read: 1 min

Yields on longer-term U.S. Treasurys have fallen further below those on short-term bonds than at any time in decades, a sign that investors think the Federal Reserve is close to winning its inflation battle regardless of the cost to economic activity. A scenario in which short-term yields exceed long-term yields is known on Wall Street as an inverted yield curve and is often seen as a red flag that a recession is looming.

☆ Wall Street Sours on Coinbase, Signaling Broad Crypto Doubts
▼ + stars: | 2022-11-17 | by ( Sam Goldfarb | ) www.wsj.com time to read: 1 min

A year ago, cryptocurrencies were roaring and Coinbase Global Inc., considered the Charles Schwab of crypto exchanges, was fresh off an IPO that valued the firm at $85 billion. Today, one market-based measure suggests that investors have doubts about whether the company can survive. As a publicly traded entity, the U.S. firm, which originated in San Francisco but says it has no headquarters, seems to have steered clear of the complex financial maneuvers that helped fell FTX, a competitor whose stunning collapse has rocked an already-reeling industry. Nonetheless, Coinbase has been burning through its cash and losing the confidence of investors. Its shares are down 81% since the start of the year, its market capitalization has shrunk to $11 billion, and its bonds are trading at a little more than half their face value.

☆ Japan’s Waning Appetite for Treasurys Fuels Anxiety on Wall Street
▼ + stars: | 2022-11-08 | by ( Sam Goldfarb | Megumi Fujikawa | ) www.wsj.com time to read: 1 min

Private Japanese investors poured hundreds of billions of dollars into U.S. and other foreign bonds in recent years, seeking better returns than they could find at home. Japan has been one of the world’s biggest buyers of U.S. Treasurys for years, helping to hold down borrowing costs for American businesses and consumers. Now that is changing. Signs are mounting that Japan’s government is selling short-term U.S. bonds, part of an effort to prop up its currency. At the same time, some Japanese institutional investors are racing to reduce their foreign bondholdings, including Treasurys.

A massive selloff in bonds. A plunge in tech stocks. The implosion of cryptocurrencies. The highest inflation in four decades. Amid a brutal and uncertain climate, we asked six heavyweights in the world of finance to share their thoughts on the state of the markets, how they have handled this year’s carnage and what they anticipate in the future.

☆ Talk of Fed Rate Slowdown Offers Respite for Bonds and Stocks
▼ + stars: | 2022-10-24 | by ( Sam Goldfarb | ) www.wsj.com time to read: 1 min

The idea that the Fed might raise rates at a slower pace sparked a rally in shorter-term Treasurys. Signs that the Federal Reserve might soon slow the pace of its interest-rate increases helped calm Treasury yields at the end of last week, offering some hope to investors that a more-stable bond market could ease pressure on stocks. U.S. Treasury yields, which move in the opposite direction of bond prices, largely declined Friday after The Wall Street Journal reported that Fed officials were poised to raise interest rates by 0.75 percentage point at their Nov. 1-2 meeting—but were also likely set to debate shifting to a smaller increase in December.

☆ Investors Fear Bond-Market Turmoil Is Entering a New Phase
▼ + stars: | 2022-09-29 | by ( Sam Goldfarb | ) www.wsj.com time to read: 1 min

Mounting volatility in government bond markets is intensifying fears on Wall Street that this year’s wild swings in the world’s safest assets could further destabilize already rocky financial markets. The worst bond rout in a generation carried the yield on the 10-year U.S. Treasury note above 4% for the first time in more than a decade on Wednesday, before emergency moves by the Bank of England prompted the biggest one-day rally in more than 13 years. The yield, a benchmark for borrowing costs on everything from mortgages to corporate loans, fell a quarter of a percentage point in a day.

☆ 10-Year Treasury Yield Hits 4%
▼ + stars: | 2022-09-28 | by ( Sam Goldfarb | Matt Grossman | ) www.wsj.com time to read: 1 min

The yield on 10-year U.S. government bonds hit 4% for the first time in more than a decade Wednesday, the latest leg of a historically steep rise that has jolted financial markets this year. Yields, which rise when bond prices fall, have been climbing at their fastest pace in four decades because of escalating expectations for how high the Federal Reserve will raise short-term interest rates to tamp down the worst inflation since the 1980s.

☆ Global Bonds Rally After 10-Year Treasury Yield Touches 4%
▼ + stars: | 2022-09-28 | by ( Sam Goldfarb | Matt Grossman | ) www.wsj.com time to read: 1 min

Government bonds in Europe and the U.S. rallied Wednesday after an announcement by the Bank of England that it would buy longer-term U.K. bonds served to ease investors’ concerns about the potential for a spiraling crisis in the global debt markets. The sharp move added to a wild run of trading sessions and came just after the 10-year U.S. Treasury note had climbed above 4% for the first time in more than a decade—a somewhat stunning milestone that was quickly swept away by the day’s events.

☆ Treasury Yields Surge as Global Central Banks Scramble to Respond to Fed, Inflation
▼ + stars: | 2022-09-22 | by ( Sam Goldfarb | ) www.wsj.com time to read: 1 min

The Bank of England raised its key interest rate by a more conservative half-percentage point but is moving ahead with plans to sell its portfolio of U.K. government bonds. U.S. government bond yields surged Thursday, after foreign governments and central banks rushed to raise interest rates or otherwise support local currencies pressured by the dollar’s strongest rally in a generation. U.S. yields were largely stable overnight after the Federal Reserve raised short-term rates by 0.75 percentage point for the third consecutive meeting and said more large rate increases are likely as the central bank seeks to quell inflation.

☆ U.S. Treasury Yields Steady Ahead of Fed Decision
▼ + stars: | 2022-09-21 | by ( Sam Goldfarb | ) www.wsj.com time to read: 1 min

Most investors expect the Federal Reserve to approve its third consecutive interest-rate increase of 0.75 percentage point Wednesday. The relentless selling in U.S. Treasurys took a pause Wednesday, with bond prices edging higher ahead of the Federal Reserve’s latest interest-rate decision. In recent trading, the yield on the benchmark 10-year U.S. Treasury note was 3.532%, according to Tradeweb, compared with 3.571% Tuesday, its highest close since March 2011.

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