ISMS 13: Global Interest Rates - Hikes Slow, Inversion Signals Recession

World - End of DM ST rate rise, inverted yield curves remain, high rates in EM

Level – High ST global and EM rates, yield curve inversion

• World ST rates at 5.3%, DM 3.6%, EM 7.7%
• World 1yr rates at 4.4%, DM 3.4%, EM 5.8%
• World 10yr rates at 4.1%, DM 3.0%, EM 5.6%

YoY rise – ST rates up massively YoY, small increase in LT rates

• World 3m yield was up 3.2ppts, DM up 3.5ppts, EM up 2.6ppts
• World 1yr yield was up 1.9ppts, DM up 2.6ppts, EM up 0.7ppts
• World 10yr yield was up 0.9ppts, DM up 1.3ppts, EM up 0.1ppts

Progression – ST rate rise stopped in DM, DM LT rates fell MoM

• 3m yield consistently grew over the past 12 months, but DM is flat MoM
• World 1yr yield has fallen for the first time in March 2023, driven by fall in DM
• 10yr yield has risen less extreme compared to short-term rates, again DM fell MoM

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