The recent surge in oil prices has also caused concerns since it is likely to prolong the inflationary cycle.
Benchmark 10-year Treasury yields hit a 16-year high of 4.50% early in Tokyo. Japan’s Nikkei fell 1%. In a split decision, the Bank of England left rates on hold for the first time in nearly two years, sending sterling to a six-month low, although Governor Andrew Bailey stressed that the job was unlikely to be done yet.
“The markets always sniff for a reversal once they see a peak, but they’ve been burnt in various ways along the way,” he said, adding that investors were positioning themselves cautiously, especially in case the rise in US rates adds pressure on the Bank of Japan to act.
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