* ECB monitoring nominal interest rates, Schnabel says. * Euro zone, U.S. 10-yr yields ease. * Australia's central bank tries to stem bond bleeding. * Emerging market stocks in biggest daily drop since May. * Graphic: World FX rates https://tmsnrt.rs/2RBWI5E. * Dollar lifted by rise in yields. * Bitcoin set for worst week since March. By Tom Arnold.
From the United States to Germany and Australia, government borrowing costs on Friday were set to end February with their biggest monthly rises in years as expectations for a post-pandemic ignition of inflation gained a life of their own. Australia's 10-year bond yield and Britain's 30-year yields were set for their biggest monthly jump since the 2009 global financial crisis.
* Aussie, Kiwi fall more than 1% * Pound knocked below $1.39. * Bitcoin slips 5% * Graphic: World FX rates https://tmsnrt.rs/2RBWI5E. By Ritvik Carvalho. The U.S. dollar rose against most major currencies on Friday, lifted by an increase in U.S. bond yields overnight, while risk currencies such as the pound, Aussie and Kiwi dollar took a knock lower.
An overnight jump in U.S. Treasury yields showed some signs of subsiding in cautious European trading on Friday, thanks to a broader retreat in euro zone yields, but worries about rising inflation expectations weighed on sentiment. Benchmark 10-year U.S. borrowing costs rose to their highest in a year at 1.614% overnight, rocking stock markets.
Futures for Canada's main stock index fell on Friday, tracking weakness in commodities, while analysts awaited data on domestic producer prices for January for further cues on business recovery. Oil prices fell as a collapse in bond prices led to gains in the U.S. dollar while crude supply is expected to rise in repsonse to prices back above pre-pandemic levels.
Stock Futures Point to Further Losses After Tech Selloff. The S&P 500 is on track for its worst week in a month after bond yields rose sharply, damping appetite for technology shares and riskier assets. Boost to Household Income Primes U.S.
Investors piling into tech and financial stocks helped equity funds attract $46.2 billion in their third-largest inflow on record in the week to Wednesday while inflation linked bonds also shone, BofA's weekly fund flow data showed on Friday.
* Graphic: World FX rates in 2020 http://tmsnrt.rs/2egbfVh. * Graphic: Trade-weighted sterling since Brexit vote http://tmsnrt.rs/2hwV9Hv. By Joice Alves. Sterling fell against a stronger dollar on Friday, retreating from a three-year high touched earlier this week, as a rout in global bond markets sent yields flying and hurt the pound, while the Bank of England warned of inflation risks.
* Euro zone yields fall, follow U.S. Treasuries lower. * German 10-year yield has shot up 25 bps in February. * Analysts say ECB intervention likely if yields rise further. * Euro zone periphery govt bond yields http://tmsnrt.rs/2ii2Bqr. By Tommy Wilkes.
* Australia 10-yr yields set for biggest monthly rise since 09. * US, UK 10-yr yields set for biggest monthly jump since 2016. * NZ yields flirt with biggest monthly rise since 94. By Dhara Ranasinghe.
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