US Treasuries erase all 2026 gains as the specter of inflation returns
The US Treasury market erased all of its gains for the year, sparked by a sharp rise in Oil prices caused by the war in Iran, investor concerns about both inflation and growth risks.
The index shifted "Bloomberg" For market performance US Treasury bonds went negative for this year after losing 1.7% since the end of February. This is an important indicator that comes in light of increasing fears of stagflation, which is pushing yields higher and forcing… "Wall Street" to lower its expectations for lower interest rates in the United States over the next year.
Morgan Stanley strategists wrote in a note: "Energy-driven inflation and policy uncertainty continue to weigh on longer-term Treasuries"
Since the US attack on Iran, investors have been demanding higher returns as compensation for the risks of higher energy prices, which could lead to a return of inflation, which could prevent the Federal Reserve from lowering interest rates, even in the event of an economic slowdown.
Bond prices fell from the United States to Japan and Australia, and the global debt index retreated from its gains since the beginning of the year.
Bob Savage, head of macro markets strategy at "Bank of New York": "Geopolitical uncertainty and heightened cross-asset volatility are likely to persist in the near term until markets gain confidence in the stability of the Iranian conflict.".
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