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Charts: Treasury Yields Could End 20-Year Bear Run

CNBC.com
Monday, 14 Dec 2009 | 6:20 AM ET

The yield of 30-Year Treasurys could be about to reverse its 20-year decline if it goes through 5 percent, Robin Griffiths, technical strategist at Cazenove Capital, told CNBC.

Charts: Treasury Yields Could Rise
The yield of 30-year Treasurys could be about to reverse its 20-year deline if it goes through 5%, Robin Griffiths, technical strategist at Cazenove Capital, told CNBC. "The market has made up its mind about Treasurys and indeed long Gilts â?? it doesn't want them," he said.

"The market has made up its mind about Treasurys and indeed long Gilts – it doesn't want them. The message has been: our cash is being turned to trash," Griffiths said.

"The yield on the 30-year … if it goes through 5 (percent), that will signal the ending of the long down-trend of the last 20 years in yields," he added.

The US and UK governments have issued large amounts of new bonds since the financial crisis and Griffiths thinks they will continue to do so. Pressure to pay for global initiatives tackling climate change will also result in new bonds being issued, he said.

A move above 5 percent would usher in a new era of inflation era, he said.

"They're going to be printing more and more Treasurys so the yield is going up, not quite to trash, but less attractive than it was. And it sort of implies that inflation is coming as well," he said.

If investors ditched government bonds then the money would have to go somewhere else and stocks could benefit from the move, he added.

- Watch the video above to see Robin Griffiths' predictions for oil prices.

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