Global bond yields have hit their highest levels since 2009 as traders scale back expectations for further easing, with markets now pricing virtually no additional cuts from the European Central Bank and renewed tightening in Japan and Australia. Long-dated US Treasury yields also climbed ahead of the Federal Reserve's expected cut today, reflecting concerns over inflation persistence, fiscal deficits, and uncertainty surrounding the next Fed chair.

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The Federal Reserve's upcoming policy decision is expected to influence how investors position for 2026, with rate expectations likely to shape equity sentiment ahead of year-end. Markets are also monitoring the potential nomination of National Economic Council Director Kevin Hassett as the next Fed chair, with President Donald Trump set to conduct final candidate interviews.

A surge in lending across corporate-bond, syndicated-loan, and private-credit markets is enabling a wave of large, highly leveraged deals, including Paramount's hostile bid for Warner Bros. Discovery and the earlier buyout of Electronic Arts. The simultaneous strength of all three financing channels is giving acquirers more options than ever, delivering big payouts to shareholders while increasing risks for bond investors as credit markets may be showing signs of overheating.

Rising government bond yields and steep forward curves are driving a surge in fixed income structured products, with issuance now topping an estimated $10 billion and expanding beyond early adopters in the US and France. Dealers say products referencing constant maturity government bond yields offer clearer investor messaging and materially higher coupons than swap-based equivalents, enabling Phoenix-style autocallables and range accruals to consistently print 7% payouts.

Senate Banking Republicans have sent Democrats a three-page compromise offer on landmark digital asset market structure legislation, outlining 38 concessions in exchange for preserving 32 key GOP-backed sections. The proposal, led by Chair Tim Scott and Sens. Cynthia Lummis, Bill Hagerty and Bernie Moreno, includes White House-vetted language on SEC/CFTC quorums and ethics, plus consumer protection and bankruptcy standards, while seeking to keep contentious provisions on self-custody and software developer protections ahead of a hoped-for markup next week.

President Donald Trump plans to conduct final interviews this week with candidates for Federal Reserve chair, including former governor Kevin Warsh and National Economic Council director Kevin Hassett, after abruptly canceling sessions last week. Treasury Secretary Scott Bessent has narrowed the field to five contenders, signaling the job isn't locked up as Trump weighs a successor to Chair Jerome Powell, who is expected to deliver another rate cut Wednesday.

Federal Reserve chair contender Kevin Hassett said he would not bow to political pressure on interest-rate decisions, even as he echoed President Trump's view that there is "plenty of room" for cuts in the months ahead. Speaking at a WSJ event, Hassett said he would rely on data and his own judgment if appointed, stressing that rates couldn't be lowered if inflation were to reaccelerate.