Germany bailout could lead to UK-style bond collapse

German Chancellor Olaf Scholz last week announced a package worth 200 billion euros ($198 billion) intended to help rising energy prices. The “defensive shield” includes a brake on gas prices and a cut in fuel sales tax. Steffi Loos | Swimming pool | Reuters Amid bleak forecasts of a recession in Germany and the wider … Read more

Barry Sternlicht Says ‘Incredible Calamities’ Ahead if Fed Continues to Walk

Billionaire Barry Sternlicht says the Federal Reserve’s aggressive rate-raising path — an attempt to curb its highest inflation rate in decades — will hurt the global economy if the central bank continues. “They are going to cause unbelievable disasters if they continue their action, and not just here, around the world,” the chairman and CEO … Read more

10- and 2-year Treasury yields fall as traders wait for PMI data

10-year and 2-year Treasury yields fell Monday as markets entered a new quarter and investors looked forward to the release of Purchasing Managers’ Index (PMI) data for the manufacturing sector. The 10-year Treasury benchmark fell 1 basis point to 3.7926% around 4:30 a.m. ET. The return on the policy-sensitive 2-year Treasury was 4.2022%, a decrease … Read more

Larry Summers denounces the UK’s ‘utterly irresponsible’ tax policy

Larry Summers Cameron Costa | CNBC LONDON – Former US Treasury Secretary Larry Summers warned on Tuesday that the UK has lost its sovereign credibility after the new administration’s fiscal policies sent markets into a tailspin. The British pound hit an all-time low against the dollar in the early hours of Monday morning before recovering … Read more

Fed’s Evans nervous about going too far and too fast with rate hikes

Charles Evans, president of the Federal Reserve of Chicago, says he is concerned that the US central bank is raising interest rates too quickly in its efforts to tackle runaway inflation. Speaking to CNBC’s “Squawk Box Europe” on Tuesday, Evans said he remains “cautiously optimistic” that the US economy can avoid a recession – provided … Read more

El-Erian says the Fed made a ‘policy mistake of historic proportions’

Allianz economic adviser Mohamed El-Erian says investors are paying the price for the Federal Reserve’s policy mistakes. “This is a two-pronged policy mistake of historic proportions,” the former CEO of bond giant Pimco told CNBC’s “Squawk Box” in a Monday interview. “Part No. 1 was tempted by ‘transient’ and doing nothing,” he added, referring to … Read more

The ‘real cure’ for inflation has been ignored, says Steve Forbes

The British pound plunged to a record low in Asia on Monday morning, following last week’s announcement by the new British government that it would implement tax cuts and investment incentives to boost growth. By focusing on raising interest rates to cool inflation, central banks and governments have overlooked the importance of maintaining stable currencies, … Read more

From the Fed to the currency crisis in Europe, here’s what’s behind this sell-off in the financial markets:

Trader on the floor of the NYSE, June 7, 2022. Source: NYSE Stocks fell sharply, bond yields rose and the dollar strengthened Friday as investors heeded the Federal Reserve’s signal that the battle with inflation could lead to much higher interest rates and a recession. The sell-off was global on Friday, in a week in … Read more

2-Year Treasury surpasses 4.2%, 15-year high as Fed drives up short-term rates

Yields moved higher on Friday, with the 2-year Treasury yield reaching a new 15-year high as markets assessed the latest Federal Reserve rate hike and what it means for the economy going forward. The policy-sensitive 2-year Treasury hovered above 4.2%, reaching a 15-year high of 4.266% earlier in the session. It last gained 12 basis … Read more

Turkey cuts interest rates again as country struggles with inflation

The number of Russian tourists to Europe dropped dramatically during the summer, but rose in several other destinations, including Turkey (here). Onur Dogman | Sopa images | Light rocket | Getty Images Turkey’s central bank surprised markets again with its decision Thursday to cut its key interest rate, despite inflation in the country soaring above … Read more