- The US 30-year bond yield slipped to multi-month lows on Thursday on haven demand.
- Coronavirus fears and stock market losses likely forced investors to put a bid under Treasuries.
The yield on the US 30-year Treasury note fell to the lowest level in four months on Thursday as investors bought the safe-haven bonds on concerns the coronavirus is spreading outside China.
The yield declined from 2.02% to 1.957% – the lowest level since September – and was last seen at 1.963%. Further, the spread between the 10-year and three-year yields turned negative, inverting the yield curve.
The government debt drew safe-haven bids amid reports stating the growing number of COVID-19 cases outside of China’s borders. The number of new infections in South Korea jumped to more than 100 on Thursday, according to local health officials. Meanwhile, two passengers from a cruise ship quarantined in Japan died due to the coronavirus. As per the latest reports by Yonhap, South Korea has confirmed 52 more cases of infections, taking the total to 156.
Additionally, the US stocks turned red on Thursday, strengthening the bid tone around the haven assets. The Dow Jones Industrial Average fell by 0.44% despite positive macroeconomic newsflow. The Philadelphia Fed manufacturing index rose to 36.7 in February to register its highest reading in three years and the Conference Board’s January reading of the US Leading Economic Indicator index rose 0.8%.
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