Deutsche Bank names adidas a top pick for Q4

Deutsche Bank's Jim Reid has highlighted a significant stress in US Treasuries, with both 10-year and 30-year yields reaching post-2000s highs, even after the Federal Reserve's dovish PCE revisions. The report points to a steady decline in long-end yields, rising real yields, and the impact of month-end positioning, as the bond market rout continues, driven by higher oil prices and robust economic growth.

This ongoing stress is evident in the 10-year Treasury yield surging to a post-2007 high of 5.28%, while the Franco-German 10-year spread widened to a post-2012 high of 127 basis points. However, the relief from the dovish repricing was short-lived, as the 2-year Treasury yield increased by 1.1 basis points to 4.89% after trading as low as 4.825% in response to the PCE release.

The 30-year yield also saw a substantial rise to a post-2002 high of 5.63%. Consequently, equities faced a setback after an initial post-PCE rally, only to experience a sharp decline in the final 15 minutes of trading, leaving the S&P 500 down 0.25% for the day, despite an early gain of 0.68%. The FXStreet Insights Team, comprising journalists who curate market observations from expert sources, includes this analysis.

The Australian trade surplus contracted sharply in August to AUD495 million, but its impact on the Aussie Dollar remains limited. Meanwhile, the US Dollar remains strong, bolstered by oil-driven inflation fears and the US-Iran standoff, which reinforce safe-haven demand for the US Dollar. Despite the softer-than-expected US PCE data, the US Dollar continues to climb, pushing bond yields to multi-year highs.

This has contributed to the decline of hyperliquid (HYPE) by 2% as of press time, easing institutional demand with $5 million in outflows on Wednesday. The technical outlook for HYPE remains mixed, with the price struggling to break above $90. Similarly, EUR/USD has dropped to its lowest level since May 2025, driven by US Dollar strength, geopolitical uncertainties, and concerns over Europe's exposure to higher energy prices.