Global stocks slip, yields rise after US jobs data suggest higher rates

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NEW YORK, Oct 4 — Global shares fell yesterday, crushed by a fresh surge in Treasury yields after US job openings rose more than expected in August, in another sign of a...

NEW YORK, Oct 4 — Global shares fell yesterday, crushed by a fresh surge in Treasury yields after US job openings rose more than expected in August, in another sign of a resilient economy that points to the Federal Reserve keeping interest rates higher for longer.

“It has all the hallmarks of intervention in all honesty,” said Michael Brown, market analyst at Trader X in London. “The Fed’s rate hike cycle is likely over, but data like today’s pose the risk that one more hike might be needed.” Rising bond yields have yet to show signs of slowing the US economy more than would be expected in a typical tightening cycle, said Atlanta Fed President Raphael Bostic, the latest Fed official to discount the market-driven spike in borrowing costs.

The yen is a particular casualty of the dollar’s march to 10-month highs and the rise in Treasury yields, given a yawning gap between US and Japanese interest rates. Traders are attaching a 27.7 per cent chance of another US rate hike in November and a 46.3 per cent chance of an increase by December, according to CME Group’s FedWatch Tool. Futures now show the Fed’s lending rate staying above 5 per cent through September 2024.Japanese Finance Minister Shunichi Suzuki said yesterday authorities were watching the currency market closely and stood ready to respond, repeating a warning against speculative moves that did not reflect economic fundamentals.

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