The inauguration of the president of the United States, Donald Trump, and the pause in the adoption of tariff measures that could plunge the first economic power of the planet in an unprecedented protectionist environment in the recent history of the West seem reassured the bondists who lived a start of the year marked by restlessness. After a high streak, the 10-year-old American bonus seems to have stabilized, again in the 4.5%area, with yields that are around this year’s minimum for the ‘T-Note’.
After a collapse in December and during the first half of this January, in part in the face of speculation that Trump’s electoral proposals – converted into federal laws – could cause a return of inflation that has cost so much time to control for the reserve Federal, profitability has been recovered in recent days. In fact, there are more than 100 basic points above its minimum of September.
Likewise, the reaction to Trump’s decision to apply a 25% tariff to imports from Mexico and Canada from February 1, and 10% against China, was contained because investors say they are still pending if the ads Trump’s electoral were a simple negotiation tactic or a firm decision.
However, the clear reference for the fixed income market this last week has been the divergent decisions in the monetary policy of the Federal Reserve and the European Central Bank. The organism directed Before the uncertainty of the impact of Trump’s economic policy while the Frankfurt institution moved away from Washington and decided to lower the types in another quarter percentage point for the fourth time in a row to 2.75%.
“It is still premature address the debate on the terminal rate“said the president of the ECB, Christine Lagarde. In the heat of their statements, the European bonds kept calm with yields for the bund German or the Spanish bonus has just moved since last week.
In fact, after the ECB movement, several members of the Governing Council have spoken about the future steps that the supervisor should follow. “My personal preference in these cases would be to use the purchase of assets strongly when necessary to avoid deflationist risks, but avoid using it excessively and persistently, since I believe that the balance between benefits and costs will change over time” , has recently warned the governor of the Bank of Netherlands, Klass Knot.
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