Term Premium is all over the place. But #term_premium is just the risk component of #yield and therefore a hodgepodge of uncertainties (inflation, neutral rate, supply). For precise analysis, nominal term premium is rather useless. Look at #Euro 10y term premium! Only further

China holds the key to success of MAGA economics . If #tarrifs and government stimulus lead China to exporting #inflation instead of #deflation, #US economy could tip toward recession. For now, China remains a deflationary force supporting US no landing scenario.

Jump in German #Bund follows recent pattern: repricing of risk component (term premium) while #inflation and #growth components (exp. real rates) stabilize. But what risk is being repriced? Supply demand imbalance but also #geopolitical risk as recpricing happens for all issuers

#Europe is moving to War Economics. This will cause a huge shift in ressources and prices. How will this be managed? Two paths are open. A WW I free market approach or a managed economy as in WW II. If primary goal is rapid push in output WW II scenario is more likely. More

#Europe is in trouble. But unlike during #Eurocrisis, risk premia on #Euro government bonds are no longer fragmented. They are moving unisono. Common #economic weakness and tight market #liquidity may play a role. But prospect of stronger #fiscal union seems priced in as well.

Nowcast is a useful tool, but as with all models, looking at different approaches gives a more solid picture. Currently a lot of talk about the Atlanta #Fed NowCast #recession signal. However, it is a massive outlier for now, other #NowCast models do not yet confirm the collapse

Market narrative has shifted from #US economic exceptionalism to underperformance. This scenario not yet confirmed by Growth Trackers. Developed ex US with steady but moderate #growth. No #recession in US, but Trump effect is gone.

While markets position for #US #stagflation, #FED communication remains in neutral territory for now (according to LLM). #ECB statements still pretty hawkish given economic weakness. Central Bank communication sentiment is lagging market prcing of interest rate changes, more to

#Stagflation or Fake-Flation? Market narrative shifting towards #US stagflation, but this is based on sentiment only. High frequency price data point to further #inflation cooling. Large divergence has opened up - unseen since #Covid. If high frequency data is correct expect

Are Chinese #equities experiencing their #AI moment? The previous close correlation with the #credit cycle seems to be broken. Just a hype or will the decoupling from the real economy be permanent? #China

#US #Treasuries have become cheaper. Usually their #yield traded below synthetic alternatives (#swap rates, hedged foreign bonds or #CDS adjusted corporate #bonds), partly due to convenience for #liquidity and security. The spread has now vansihed. Plumbing may play a role, but

Recent market collpase is not about #recession or #CPI. It is about liquidity stress and deleveraging. That’s why #US 30y swap spread is most alarming place in markets right now. Sharp drop points at collateral shortage and/or massive #UST liquidation. It's no coincidence 30y hit

US Treasury complex is experiencing a Liz Truss moment. But the important question: Can current Fed policy outlast a lettuce?

#Japan and #US 30y repricing are most scariest things in global #bond market. Japan is often overlooked, yet low #JGB yields have been an anchor for #liquidity and #volatility suppression for decades. Latest massive rise shows end of BoJ yield control and/or forced selling. Both

With strong issuance, sovereign bonds (#UST and #Bunds) became cheaper relative to other (private) assets. Their #safety and #liquidity premium (convenience #yield) has been reduced. Illustares downward sloping demand for safety: rising supply erases convenience yield. However,

After decades of secular stagnation narrative suppressing long #yields globally, we see strong steepening as uncertainty narrative is taking over and markets anticipate higher equilibrium rate to balance debt supply and demand. Term premium captures this being at a 10y high for

Survey-based #US #inflation expectations spiked due to #tariff conflict. Market-based expectations remained steady or even decreased. News flow (trade #deals, pharma, oil price) points to easing inflation pressure. Divergence should close with May surveys. But divergence btw 2y

Short-term survey-based #US #inflation expectations used to be essentially a function of gasoline prices. This link has broken with #tariff uncertainty. But also recent methodological switches from personal interaction to anonymous internet surveys may have contributed to more

Reverse repos at the FED keeps rising into the Q3-end snapshot, now at ~56.22bn$ Keep an eye on the standing repo facility today, on the 30th June banks needed to borrow ~11bn$ from the FED. If they borrow more today it will be a sign of worsening liquidity in the system.