(Bloomberg) –Treasuries extended declines, stoked by expectations for aggressive interest-rate hikes around the globe.
Yields rose on Tuesday, with the rate on the U.S. 30-year bond hitting the highest since June. Italian debt is among the laggards in Europe as money markets price the end of negative deposit rates by December, even after European Central Bank President Christine Lagarde said any adjustment to policy will be “gradual.”
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The move reversed about half of its 12-basis-point drop on Nov. 5, when the Nasdaq 100 index suffered its biggest slide since March 2020.
The U.S. midterm elections sparked declines for shares of large U.S. technology companies and oil prices that fueled gains for U.S. government bonds, sending yields to the lowest levels since early September.
The Treasury market last month notched its biggest gain in more than two years as investors lost faith in the sustainability of capital spending on artificial-intelligence infrastructure.
Concerns regarding AI companies' ability to handle inflation drove the 10-year Treasury under 5%, but with data still running hot, could yields turn upward?
The Federal Open Market Committee's voting history heading into previous elections might shed light on how it approaches this week's decision.
