In bondage?

Daily update

US 10-year Treasury bond yields moved sharply above 5%, and the USDJPY exchange rate is back above 158. US Treasury Secretary “House” Bessent seems to be demonstrating the house does not always win. For Gen Z bond traders, a 0.15-percentage point rise in yields is scary. For Gen X bond traders, it is mild. A variety of concerns came together to worry the markets.
Today’s summit between China’s President Xi and US President Trump is not expected to produce much of substance—extending the trade truce and limiting the tariffs US importers have to pay was expected. There is also always uncertainty about whether the US administration will stick to any announced initiatives.
Speculation about a US diesel export ban continues—US Energy Secretary Wright said it would not bring down prices, and Wright is probably right. However, the politician’s paradox “we must do something, this is something, we must do this” may still provoke action. Markets care because of the inflation consequences.
There is a pontification of central banker speakers on the agenda today—two from the European Central Bank, three from the Bank of England, and four from the Federal Reserve. One of them might even say something interesting.