Oddbean

Analysis-Biggest month of bond supply to test markets as rate cut bets fade ========== Global bond markets face the biggest amount of net sovereign issuance in June, with net government bond supply likely to rise to $340 billion for the United States, euro zone countries, and Britain. The increase in bond supply comes as economic data throws rate cuts into doubt, testing investors' appetite for debt. The potential increase in supply could add upward pressure on yields and spook investors who were hoping for a bond market rally this year. Weak U.S. Treasury auctions on Tuesday may be an early sign of market struggle. Central banks are reducing their bond holdings, and developed market governments are still borrowing large amounts to help their economies recover. Investors have been eager to step in, but concerns about rising debt levels and mounting deficits may lead to higher risk premiums in the future. June's elevated net supply is driven by a fall in maturing bonds, which means investors have less cash to reinvest in the primary market. Overall, the article highlights the challenges and risks faced by bond markets as they navigate increased supply and uncertain rate cut expectations. #BondMarkets #RateCuts #BondSupply #EconomicData https://www.investing.com/news/economy-news/analysisbiggest-month-of-bond-supply-to-test-markets-as-rate-cut-bets-fade-3462417