Global Weekly Fixed Income Report - October 23, 2026

Executive Summary

Treasuries rallied for a second week, and the credit market says it was the wrong kind of rally. The 10-year fell 9 basis points to 5.00% and the 30-year 10 to 5.33%, almost all of it on Thursday, when a 2.9% fall in the Nasdaq on worries about funding for AI investment took the 10-year down 17 basis points in a day to 4.96%. Over the same week the ICE BofA US high yield spread widened 9 basis points to 3.40%, its widest since the end of March.

This week's Chart of the Week sorts three years of weekly moves into four groups: lower yields with tighter spreads, which is a benign rally, and lower yields with wider spreads, which is a growth scare. The last three weeks all landed in the growth-scare quadrant, the first run of three in the 156-week sample. Over the past two weeks the 10-year has fallen 28 basis points and the high yield spread has widened 29. That is investors buying protection against weaker growth and a cracked AI trade, not pricing a friendlier Fed. A December hike is now about 84% priced, up from 70.6% a week ago.

For this week our view is that the 10-year holds a 4.90% to 5.10% range. A Fed hold on Wednesday with a tightening bias, Brent at $116.72 and a September PCE report expected to show headline inflation rising to 3.6% all lean against a further rally. The equity market and three large technology earnings reports lean the other way. We stay neutral on duration with no curve position, and we do not treat a lower 10-year as a signal to add risk elsewhere.

In African credit the oil signal lost to beta. Brent rose 6.2%, yet Angola widened 35.7 basis points against matched Treasuries, the worst result in the coverage, while Nigeria widened only 4.0 and South Africa 7.4. Ghana widened 29.6 and Egypt 30.8. In a growth scare, high-yielding credits trade like US high yield whatever the commodity backdrop, and Angola is the highest-yielding credit in our book. We are halving the Angola overweight this week and keeping Nigeria, the low-beta exporter, at full size.

Senegal is not covered in this edition because no prices were supplied for the week. Its chart and section return when the data does.