The global sell-off of bonds extended into the Asian markets on Friday in reaction to the smaller-than expected 25 basis point interest rate cut by the U.S. Federal Reserve earlier this week, according to Reuters.

Share markets rose, and government issued Japanese bonds (JGBs) were sold off at a rapid rate, due to investors seeking better returns elsewhere. U.S. treasuries tanked on Thursday as well, with a General Motors offering that lured away investors who felt the Fed’s monetary policy was a disappointment.

At the end of December, Japan had the equivalent of $4.5 million in marketable securities outstanding, according to a recent Bloomberg report. By contrast, the United States stands at $3.6 trillion.

The trend, as observed by industry analysts, is that investors have been selling off their bonds, government issued or otherwise in favor of stocks with potentially higher yields.

 

The staff of Money Management Executive ("MME") has prepared these capsule summaries based on reports published by the news sources to which they are attributed. Those news sources are not associated with MME, and have not prepared, sponsored, endorsed, or approved these summaries.

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