Treasuries, Dollar Dip as China Warns on US Bonds: Markets Wrap
(Bloomberg) — Treasuries slipped after Chinese regulators urged banks to scale back holdings of US government debt, sending the dollar lower as well. Stock futures held steady.
Yields rose across the curve, led by the longer end, with the 10-year rate up three basis points to 4.23%. The dollar fell 0.2%. The moves followed Chinese officials advising financial institutions to limit Treasury purchases due to concerns over volatility and concentration, people familiar with the matter said.
Stocks, precious metals and crypto posted muted moves after more than a week of sharp swings. S&P 500 futures were little changed after the benchmark’s best day since May, while Bitcoin hovered near $70,000. Gold traded just above $5,000 an ounce.
Domestic politics also influenced markets on Monday. Japanese stocks and yields jumped after Prime Minister Sanae Takaichi’s thumping election win. UK gilts came under pressure as the future of UK Prime Minister Keir Starmer hanged in the balance over the appointment of Peter Mandelson as US ambassador.
With markets also attuned to the outlook for US interest rates, attention will turn to a busy data calendar this week, highlighted by January payrolls on Wednesday and inflation figures two days later. The Treasury is also due to offer a combined $125 billion in three-, five and 10-year in debt this week.
“With positioning clearer, barring new catalysts we don’t see volatility continuing in the same way, said Geoff Yu, senior macro strategist at BNY. “Data releases out of the US this week will be important.”
What Bloomberg strategists say…
The US dollar faces a potentially severe challenge from a report saying China urged its banks to curb Treasuries exposure. Just as the currency was bouncing back from the credibility angst that assailed it amid the Greenland tariffs turmoil, this sort of signal from one of the largest holders of currency reserves will act to revive a willingness to price down the greenback.
— Garfield Reynolds, MLIV Team Leader. For full analysis, click here.
Corporate News:
Novo Nordisk A/S shares surged, reversing some of last week’s plunge, after Hims & Hers Health Inc. pulled a copycat version of the new Wegovy weight-loss pill. Apple Inc. is going to begin a 2026 product blitz with the iPhone 17e, updated iPads and fresh Macs. UniCredit SpA plans to return about €50 billion ($59 billion) to investors through 2030 as Chief Executive Officer Andrea Orcel vows to further improve profitability and capital generation over the next five years. NatWest Group Plc agreed to buy private equity-backed wealth management group Evelyn Partners, as the British bank looks to increase its access to affluent clients in its home market. Some of the main moves in markets:
Stocks
The Stoxx Europe 600 rose 0.3% as of 8:26 a.m. London time S&P 500 futures were little changed Nasdaq 100 futures were little changed Futures on the Dow Jones Industrial Average rose 0.2% The MSCI Asia Pacific Index rose 2.3% The MSCI Emerging Markets Index rose 2% Currencies
The Bloomberg Dollar Spot Index fell 0.2% The euro rose 0.3% to $1.1855 The Japanese yen rose 0.3% to 156.69 per dollar The offshore yuan was little changed at 6.9243 per dollar The British pound was little changed at $1.3599 Cryptocurrencies
Bitcoin fell 0.7% to $70,138.99 Ether fell 1.8% to $2,056.39 Bonds
The yield on 10-year Treasuries advanced three basis points to 4.23% Germany’s 10-year yield advanced one basis point to 2.86% Britain’s 10-year yield advanced three basis points to 4.54% Commodities
Brent crude fell 1% to $67.38 a barrel Spot gold rose 1.3% to $5,026.53 an ounce This story was produced with the assistance of Bloomberg Automation.
–With assistance from Anand Krishnamoorthy.
©2026 Bloomberg L.P.
