Market Prognosis

A concise summary of the major macro events of the past 24 hours, and selected UK company-specific news.

October 19, 2023

Global bond yields at pre GFC levels

Macro & Overnight

Geopolitical tensions still dominate financial markets.

10-year US Treasury yields close in on 5%, a level last seen in 2007, and we all know what happened next.

Investors will focus more than usual on the comments from Jay Powell as he speaks to the Economics Club of New York later today. However, the fear remains that the bond markets will continue the tightening cycle where the central banks have left off.

UK 10-year Gilt yields, while above the panic levels of 2022, remain 100 bps below pre-GFC levels. While hardly a positive, at least the UK is no longer singled out as the crisis-hit outlier of prior periods.

Oil prices increased, with Brent crude at $91, as Middle Eastern tensions remained elevated amid ongoing diplomatic activity but stabilised as the US reduced restrictions on Venezuelan exports.

Prognosticator 

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