Gl Global long-end bonds Loading... : Investor Sentiment and Bull/Bear Views

He is bullish on long-end Treasuries and global long-end bonds for the next couple of months, expecting long-end yields to fall. Catalysts include: Trump's shift on the Iran war adding an oil risk premium but with oil now having asymmetric downside; a Fed hike over 90% priced, with delivery restoring credibility and bringing down long-end yields even if the front end bumps; a possible AI spending slowdown as a bigger but slower trigger; attractive yields, with the 10-year yield needing to rise about 70bp over the next year to make him wrong; and countercyclical pressures from higher yields hurting stocks and oil, which drives growth fears and Treasury buying. He sees lower yields a month from now and lower than current by year-end.

Long-end government bond yields may hold near current levels, but the bond market is fragile. Persistent news flow, structural supply/demand changes, regulatory shifts like European life insurer rules, and fiscal concerns across Japan, Europe, and the U.S. are driving long-end volatility. Spillovers from one country, such as Japan's 26bp yield move this week, mean bond volatility is likely to remain for some time.