The bond market was sold off at the beginning of 2026: 30-year U.S. Treasury yields hit a four-month high, as optimistic economic expectations greatly reduced demand for safe havens.

Notice that US Treasury bonds fell on the first trading day of 2026, with the 30-year bond yield rising to its highest level since early September last year as market optimism about US growth prospects weakened demand for safe-haven assets. The 30-year US bond yield rose by 4 basis points, reaching 4.88%; while the 10-year US bond yield rose by 2 basis points to 4.19%. Prior to this, data showed that initial jobless claims in the US dropped to one of the lowest levels of the year. Eugene Leow, fixed income strategist at DBS Bank, said: "The oscillation higher in longer-end yields may reflect strengthening optimism about the US economy, perhaps echoing in the stock market as well." Australian bonds also fell, as the market speculated that rising commodity prices would enhance the country's growth prospects, with yields on 3-year and 10-year bonds both rising by about 9 basis points. The Australian dollar rose by 0.5%, outperforming other currencies in the Group of Ten (G10). Homin Lee, strategist at Lombard Odier, said: "The fluctuations in the Australian dollar and interest rates today partly reflect bond investors' cautious positioning ahead of the release of December US nonfarm payrolls data. The expansion of global metal trade markets is also contributing to this momentum." German and French long-term bonds also recorded declines at the opening.