INSUBCONTINENT EXCLUSIVE:
biggest oil exporters triggered an unprecedented global bond rally.
US Treasury yields plunged, with the rate on 30-year bonds diving as
much as 59 basis points, as rising expectations the Federal Reserve will cut policy rates to 0% in the coming months drove investors to
reach to longer maturities for yield
New Zealand fell to new lows.
The spread of the coronavirus and its fallout on supply chains and consumer spending have seen a dramatic
repricing of global interest-rate expectations in the past month
The jolt lower in oil from the price war will sap inflation, increasing pressure on the Fed to take rates to the lowest since the global
financial crisis.
"The more I think about it, the more it makes sense to me that that the US cash rate will fall below zero some time very,
very soon," said Chris Rands, portfolio manager at Nikko Asset Management Ltd in Sydney
Adding to the sense of malaise, Japan posted its biggest economic contraction in more than five years, while France said its economy may
barely expand.
Risk assets plunged with S-P futures dropping about 5% to hit circuit breakers, and European stocks plunged by the most since
2016, putting the STOXX Europe 600 Index on course for a bear market
Italian bonds plunged, sending the yield on 10-year debt to 1.23%.
Meanwhile, the yen and the euro strengthened
And the dollar, which suffered its worst week in two years, was up slightly, as soaring demand for US
The dollar has an edge over its peers by being the world's reserve currency of choice.