Global Bonds Surge Toward Best Month Since 2008 Financial Crisis

Global bonds are soaring at the fastest pace since the 2008 financial crisis.

A Bloomberg gauge of global sovereign and corporate debt has returned 4.9% this month, the most since it surged 6.2% in the depths of the recession in December 2008. The rally is being driven by increasing speculation the Federal Reserve and its global peers have largely finished hiking interest rates.

Investors have piled back into fixed-income assets in November as signs global growth is cooling have spurred traders to build bets on Fed rate cuts during 2024. Fed Governor Christopher Waller gave more impetus to that move Tuesday, saying the current level of policy looks well positioned to slow the economy and bring down inflation.

Rallying Like It's 2008

“Waller has been a hawkish tilting member, so for him to sound dovish has been significant,” said James Wilson, a senior portfolio manager at Jamieson Coote Bonds Pty in Melbourne. “It sounds like the Fed is all but done in their hiking cycle.”

Treasuries extended this month’s gain in Asian trading Wednesday, with US 10-year yields dropping below 4.3% for the first time in more than two months. Similar-maturity Australian bonds tumbled as much as 14 basis points after weaker-than-expected local inflation data spurred traders to start betting policymakers are done hiking.