Global Market Summary
Global bond yields remained elevated this week ahead of next week’s key U.S. Federal Reserve (Fed) meeting. While recent comments from Fed officials have indicated some confidence in inflation coming lower, the recent disappointments in the underlying readings — particularly for core service prices — will likely introduce a note of caution into the Fed’s assessment of the prospect for any easing in interest rates. Ten-year U.S. Treasury yields edged up by five basis points during the week to 4.64%. In Europe, the European Central Bank (ECB) still appears on track to initiate a rate-cutting cycle in the summer. Spreads across major credit sectors tightened and total returns were mixed. The U.S. dollar retreated against the euro and the average spot currency performance in emerging markets was positive for the week.