Investor concerns about US Government plans for big issues of new Treasury bonds to fund ongoing deficits is driving up bond yields globally this morning.
In our bonus deep-dive interview, ANZ’s Chief Economist for Greater China Raymond Yeung has identified a tipping point for the debt bound up in China’s key Local Government Financing Vehicles (LGFVs).
5 things to know
US 10 year Treasury bond yields bounced 8 bps overnight to 4.71% as investors demand higher real returns in the face of heavy issuance. ANZ’s Head of G3 Economics Brian Martin says investors want higher real returns.
Ongoing US fiscal deficits and the need for big new issues of US Treasuries are a factor in the rise in global bond yields, Brian says.
Malaysia has announced tax increases and lower fuel subsidies to improve its fiscal situation, says ANZ’s Chief Economist for Southeast Asia & India Sanjay Mathur.
Sanjay says the improvement is needed to contain Malaysia’s relatively high debt-to-gdp ratio of 62%.
ANZ Economist Henry Russell sees New Zealand’s headline annual inflation rate rising to 6.1% in data due later today.
Cheers
Bernard
PS: Catch you tomorrow with part two of our deep-dive interview with Raymond Yeung on the changes needed to restructure and stabilise China’s local government debt.
