Speaking in Singapore ahead of next week's annual meetings in Bangkok, Kristalina Georgieva told governments they face 'very tough political choices' and urged them to rein in spending. Ten-year borrowing costs in the United States, Germany and Japan are at their highest in decades, she said, and still climbing. Global debt is about to pass 100 percent of GDP. The short end. I wrote about the ten-year yield. She pointed at the other end of the curve: higher policy rates lift short-term yields, and those feed directly into the cost of short-dated debt. A treasury that funds itself short meets the new rates within months, not years. Maturity profile belongs next to the debt ratio in any sovereign analysis. The temporary force is not fading. Of the four pressures on yields, I called inflation the one that could reverse. The IMF describes the energy shock from the Iran war as largely contained, but oil is still around 100 dollars a barrel and could rise as the northern winter approaches...
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