Volatility creeps higher with US yields, keeping safe havens bid
Financial markets are facing headwinds this morning from higher interest rates and a slowing Chinese economy. Equity futures are setting up for a lower open, US Treasury yields are inching lower after again challenging multi-decade highs during yesterday’s session, and commodity prices are trading sideways as markets simultaneously downgrade Chinese demand forecasts and raise stimulus expectations. Foreign exchange markets are trading on a mixed footing, with risk-sensitive currencies fighting an increase in implied volatility expectations – partly seasonal, partly rates-driven, and partly China-related – even as domestic yields play catch up with the United States North America Expectations are rising ahead...