(CercleFinance.com) – The weekend was marked by Moody’s decision to lower its credit rating of the United States to ‘Aaa’ with a negative outlook (at the next downgrade, the rating would go to ‘AA’).
A decision received without emotion by the US bond market with T-Bonds deteriorating by +2 Points to 4.6470%, a completely banal and insignificant variation, against a backdrop of lower volatility than previous sessions (November 8, 9 and 10 ).
Moody’s decision is not the only concern that could have worried holders of US debt: there is also the risk of ‘shutdown’ if the ceiling on federal spending is not raised.
But since it is an annual soap opera that has lasted for decades (the Clinton era, before the year 2000) and it always ends with the vote for an ‘addition’ of tens or hundreds of billions, Wall Street doesn’t care much.
In Europe, the bond market remained at a standstill all day with perfect stability on OATs at 3.293% and almost perfect on Bunds (+0.5Pt at 2.715%)… and perfect stability on Italian BTPs at 4.5700%.
There were no ‘stats’ this Monday to liven up the discussions, so we are experiencing a ‘transition’ session… without initiatives and without technical signals.
The week is starting slowly but promises to be rich in ‘macro’ data of primary importance, including the latest inflation figures in the United States, but also retail sales and new data on the real estate sector beyond. -Atlantic.
These indicators should confirm that a slowdown in the global economy is indeed underway, but also that inflation is only falling very gradually.
Some important statistics are also expected in Europe, including consumer prices in October, the second estimate of third quarter GDP and the ZEW index of German investor sentiment.
This data could lead to renewed volatility in the bond sector, already subject to significant roller coaster movements in recent times.
The past week ended with divergent developments on both sides of the Atlantic, with a decline in debts denominated in euros and a small technical jump in T-Bonds despite Thursday’s air gap due to the semi -failure of a US Treasury issue.
‘The volatility of the long parts of the yield curve remains very high, with curves still inverted despite the recent movement, which leads us to maintain a preference for the short parts of the curve’, underlines François Rimeu, senior strategist at La Française AM.
“For the first time in 15 years, the normalization of interest rates and more resilient inflation than expected have made investing in bonds more efficient than in stocks,” recalls Mauro Ratto, co-founder and co-director of investments at Plenisfer.
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