A global bond selloff has pushed government borrowing costs higher, including yields on US Treasurys. According to Vishnu Varathan, Mizuho's head of macro strategy for Asia Pacific, investors dumping French government bonds over fiscal and political concerns sought refuge in the relative safety of US Treasurys and German bunds. Varathan wrote in a note on Thursday that the initial response appeared to be a run for cover benefiting bunds and US Treasurys rather than outright contagion. Treasury yields still edged higher overnight, but Mizuho warned that French turmoil may be masking deeper risks in the US bond market.
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