International News 04 September 2025
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Global Bond Issuance Surges Past $100 Billion in a Single Day
Global bond markets witnessed one of their busiest days of the year on Tuesday (Sept 2, 2025), with investment-grade issuance totaling about US$90 billion, driven by strong investor demand and expectations of a Federal Reserve rate cut. In the US, 27 companies sold US$43.3 billion in high-grade bonds, marking the third-largest daily volume in history, while Europe saw over €47 billion (US$54.7 billion) in deals, surpassing earlier records. Asia also joined the wave, led by seven Japanese issuers raising US$10 billion, pushing combined global issuance in dollars and euros above US$100 billion for the first time in over a year. Investors rushed to lock in yields, with average corporate bond yields at 4.4%, the lowest in a year. Despite global equity weakness and rising government bond yields, issuers aggressively tapped the market, underscoring robust demand. Major deals included Merck & Co. in the US, Unibail-Rodamco-Westfield in Europe, and the State Bank of India, which achieved record-low spreads for an Indian lender. Analysts noted that while the surge had been anticipated, the sheer scale exceeded expectations, reflecting exceptional liquidity. With September traditionally a busy issuance month, banks like Wells Fargo and Goldman Sachs project weekly issuance could reach US$55–75 billion, though risks remain from upcoming US economic data, the Fed meeting, and the earnings blackout period.
Gold Extends Record Rally on Fed Rate Cut Bets and Market Uncertainty
Gold prices hit fresh record highs on Wednesday (Sept 3, 2025), as mounting market uncertainty and rising expectations of a Federal Reserve rate cut boosted demand for safe-haven assets. Spot gold rose 0.1% to US$3,536.58 per ounce after touching an all-time peak of US$3,546.99 earlier in the session, while US gold futures for December delivery gained 0.3% to US$3,602.40. Political and legal tensions in the US added to volatility, with President Donald Trump seeking Supreme Court intervention to fast-track a tariff ruling and intensifying pressure on the Fed, including attempts to oust Chair Jerome Powell and Governor Lisa Cook. Markets are now pricing in a 92% chance of a 25-basis-point Fed rate cut at its September 17 meeting, according to CME FedWatch. The bias toward gold remains strong, with analysts citing both political risks and concerns over Fed independence as key drivers. SPDR Gold Trust, the world’s largest gold-backed ETF, reported a 1.32% increase in holdings to 990.56 tons—the highest since August 2022—underscoring surging investor demand. Traders are closely watching Friday’s US non-farm payrolls data, which could shape expectations for the Fed’s next policy move and determine whether gold’s momentum can extend further.
Japan’s Long-Term Bond Yields Hit Record High Amid Political Turmoil
Japanese Government Bonds (JGBs) extended their selloff on Wednesday (Sept 3, 2025), sending super-long yields to historic highs amid rising political uncertainty. The 30-year JGB yield surged 8 basis points to 3.28%, its highest on record, while the 20-year yield climbed 7 basis points to 2.69%, the strongest level since October 1999. The selloff was triggered after Hiroshi Moriyama, Secretary-General of the ruling Liberal Democratic Party (LDP) and a key ally of Prime Minister Shigeru Ishiba, announced plans to resign—fueling speculation that Ishiba himself could step down following his party’s electoral defeat. Markets are now weighing potential policy shifts if leadership changes occur. Analysts warn that a resignation could force the government to expand fiscal spending, while Sanae Takaichi—seen as a possible successor—may push for continued ultra-low interest rates alongside stronger fiscal stimulus. The heightened political risks come just as Japan prepares a 30-year bond auction, further straining investor sentiment and amplifying concerns over rising borrowing costs.