That trend will worry bond investors, with the longest-dated debt already lagging behind shorter maturities this year on concern governments will ramp up borrowing to fund spending pledges. What could worsen it is sticky inflation in Japan, political turmoil in France, and speculation that President Donald Trump may push the Federal Reserve to cut interest rates, amplifying price pressures stateside.
Longer-maturity bonds may be in for a treacherous September, if history is any guide.
Over the last decade, government bonds globally with maturities of over 10 years posted a median loss of 2% in September, according to data compiled by Bloomberg. That’s the worst monthly performance of the year.
