Treasuries fell, with yields rising to a seven-year high versus their developed-market peers, before a jobs report tomorrow forecast to show the U.S. economy is strengthening as major central bank policies diverge.
David Tepper, founder of $20 billion hedge-fund firm Appaloosa Management LP, called the bond-market rally “done” after the European Central Bank unexpectedly cut interest rates and pledged to buy asset-backed securities to spur economic growth while staving off the threat of deflation. The U.S. benchmark 10-year note yielded the most versus its Group of Seven counterparts since 2007 as European yields plunged.
“If you looked at the U.S. in a vacuum or a bubble, clearly bond yields should be higher,” Eric Stein, a money manager at Boston-based Eaton Vance Corp., said in a phone interview. Stein oversees about $13 billion. “Growth has picked up considerably.”
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