
German yields fell sharply this week, led by shorter maturities. The 2-year yield dropped 21 basis points to 3.07%, and the 10-year fell 14 basis points to 3.46%. Investors moved into German bonds as worries about government debt spread from France to Italy. The gap between Italian and German 10-year yields jumped from 91 to 114 basis points, and France's gap widened too. Lower energy prices, weak US jobs data and central bankers pushing back against more rate rises added to the rally. Markets now see European Central Bank rates peaking at around 3.15%, down from more than 3.5% a week earlier.

US Treasury yields moved the other way at the long end. The 10-year yield rose 11 basis points to 5.27%, its highest level since 2002, while the 2-year slipped 3 basis points to 4.83%. Strong economic data, including revisions showing US consumers in better shape than thought, kept investors expecting more Federal Reserve rate rises. Yields stayed high even after Friday's jobs report showed only 29,000 new jobs, far below forecasts. Over September, the 10-year yield rose 53 basis points, its biggest monthly jump since 2022.

UK gilt yields barely moved. The 2-year yield fell 2 basis points to 4.81%, and the 10-year edged up 1 basis point to 5.37%. Some investors bought gilts as a safe haven alongside German bonds, but the rise in US yields kept long-dated gilts from rallying. Markets still expect the Bank of England to raise rates, with about 90 basis points of increases priced by the end of 2027. At the Labour Party conference, Prime Minister Burnham and Chancellor Healey promised to stick to the government's borrowing rules in the October budget.

With yields near multi-year highs, medium-term German bonds and 10-year UK gilts look attractive for long-term investors who can sit through short-term swings, though there is still no clear trigger for a lasting fall in US yields.
Safe-haven bonds led the gains as investors left riskier European debt. Long-dated German government bonds rose between 1.8% and 1.9%, with the 2048, 2053 and 2054 Bunds all in the top five. Swiss hydropower company Kraftwerke Linth-Limmern topped the list, with its 2052 bond up 2.4% as long-dated Swiss franc bonds rallied. Chemicals group BASF also gained, with its 2037 bond up 2.3% as German yields fell.
| Name | Cur | Price change 1w(%) |
Yield | Risk Level |
| Kftwrk Linth Lim 3% Sep 2052 | CHF | 2,36% | 1,85% | Very High |
| BASF 1.625% Nov 2037 | EUR | 2,34% | 4,29% | Low |
| Germany 1.25% Aug 2048 | EUR | 1,92% | 3,81% | Very Low |
| Germany 1.8% Aug 2053 | EUR | 1,88% | 3,81% | Very Low |
| Germany 2.5% Aug 2054 | EUR | 1,80% | 3,83% | Very Low |
| Pfndbnk Schweiz 0% May 2045 | CHF | 1,72% | 1,18% | Very Low |
| Netherlands 3.5% Jan 2056 | EUR | 1,71% | 3,79% | Very Low |
| Pfandbrief Kntbk 1.15% Jan 2046 | CHF | 1,71% | 1,22% | Very Low |
| Pfndbnk Schweiz 2.25% Jul 2052 | CHF | 1,68% | 1,17% | Very Low |
| Pfndbnk Schweiz 0.375% Jun 2046 | CHF | 1,67% | 1,22% | Very Low |
Riskier bonds fell hardest. Ukraine's 2034 bond led the losers with a 7.4% drop, and Gabon's 2031 bond lost 5.5%, as rising US yields and nervous markets hit emerging-market debt. Paramount Global's 2032 bond fell 6.1% and Warner Bros. Discovery's 2033 euro bond lost 5.4%. Paramount Skydance sold $52 billion of debt this week to fund its takeover of Warner Bros. Discovery, and much of the new debt weakened in trading. Mexican state oil company Pemex's 2060 bond dropped 5.0% as long-term US yields climbed.
| Name | Cur | Price change 1w(%) |
Yield | Risk Level |
| Ukraine 4.5% Feb 2034 | USD | -7,37% | 14,95% | Very High |
| Paramount Global 4.2% May 2032 | USD | -6,10% | 9,58% | High |
| Gabon 7% Nov 2031 | USD | -5,55% | 11,77% | Very High |
| Warnermedia Hldg 4.693% May 2033 | EUR | -5,42% | 6,57% | High |
| Pemex 6.95% Jan 2060 | USD | -5,04% | 9,41% | High |
| Jordan 7.375% Oct 2047 | USD | -4,79% | 8,19% | High |
| Pemex 7.69% Jan 2050 | USD | -4,63% | 9,44% | High |
| Whirlpool 5.75% Mar 2034 | USD | -4,51% | 12,03% | High |
| Ecopetrol 5.875% May 2045 | USD | -4,41% | 8,72% | High |
| Sealed Air 6.875% Jul 2033 | USD | -4,35% | 7,66% | High |
Note: only long-term senior unsecured ratings were taken into account.
Upgrades clearly outnumbered downgrades this week, 30 to 14. S&P raised Wells Fargo to A-, Fitch lifted American Express to A+, and Fitch also moved UK fund manager Schroders up to AA-. On the downside, S&P cut US food group Hormel Foods to BBB+, and Moody's lowered Finnish paper maker UPM-Kymmene to Baa2. Several companies coming out of debt restructurings also received higher ratings.
| Issuer | Agency | Change |
| AAR | S&P | BB → BB- |
| Advancion | S&P | D → CCC+ |
| Alior Bank | Fitch | BB+ → BBB- |
| American Express | Fitch | A → A+ |
| Atlas CC | S&P | D → CCC |
| Banco BPM | S&P | BBB → BBB+ |
| Bank of Ceylon | Fitch | CCC+ → B- |
| Befesa | S&P | BB → BB+ |
| Berner Kantonalbank | Moody's | A2 → A1 |
| Bolivia | Moody's | Caa3 → Caa2 |
| China International Capital | Moody's | Baa1 → A3 |
| China Merchants Port | Moody's | Baa1 → A3 |
| Chrome Holdco | S&P | SD → CCC- |
| CITIC Securities | Moody's | Baa1 → A3 |
| Delhi International Airport | S&P | BB → BB+ |
| Flos B&B Italia | Fitch | B → B+ |
| Fluvius System Operator | Moody's | A3 → Baa1 |
| GMR Hyderabad International Airport | S&P | BB → BBB- |
| Great Places Housing | Fitch | A → A- |
| Guotai Haitong Securities | Moody's | Baa1 → A3 |
| Herens Midco | S&P | SD → B- |
| Hormel Foods | S&P | A- → BBB+ |
| Innio | S&P | B+ → BB- |
| Interstate Waste Services | S&P | B → B- |
| JELD-WEN | S&P | CCC+ → CC |
| LATAM Airlines | Fitch | BB → BB+ |
| Leslie's Poolmart | S&P | CCC- → D |
| Lineage | Fitch | BBB+ → BBB |
| Meihua Holdings | Moody's | Baa3 → Baa2 |
| Michaels Companies | S&P | B- → B |
| Oma Saastopankki | S&P | BBB → BBB+ |
| Oscar AcquisitionCo | S&P | CCC → D |
| Platform Housing | Fitch | A+ → A |
| Raven Acquisition | S&P | B- → B |
| Recycle and Resource Operations | S&P | SD → CCC+ |
| Schroders | Fitch | A+ → AA- |
| Sveafastigheter | Fitch | BBB- → BBB |
| Talen Energy | Fitch | BB- → B+ |
| Torrid | S&P | CCC+ → CCC |
| Trekor Metals | Fitch | B- → B |
| UPM-Kymmene | Moody's | Baa1 → Baa2 |
| Veracode Parent | S&P | CCC+ → CCC |
| Vivo Energy | S&P | BB+ → BBB- |
| Wells Fargo | S&P | BBB+ → A- |
New bond sales slowed as rising yields made borrowing more expensive. The table shows only bonds sold in small lots, with a minimum investment of 2,000 or less in the bond's currency. Deals sold only in large blocks, or only to big US institutional investors, are left out. Paramount Skydance dominated the week: its dollar bonds in the table add up to about $41 billion, at yields from 6.3% to 9.1%, and many of them fell in price soon after the sale. Soup maker Campbell's found lukewarm demand for its new 30-year bond at 8.5%. In euros, Deutsche Telekom sold €1.9 billion across three bonds and Bulgaria raised €2.25 billion, while US grocer Kroger sold $1.5 billion of dollar bonds.
| Issuer | Size | Term | Yield | Risk Level |
| Asian Development Bank | GBP 0,75bn |
3Y | FLOAT | Very Low |
|
ISIN (CUSIP)
XS3528345211
|
||||
| Bain Capital Private Credit | USD 0,35bn |
5Y | 7,9% | Medium |
|
ISIN (CUSIP)
USU0553AAA35
|
||||
| Campbell's | USD 0,30bn |
30Y | 8,5% | High |
|
ISIN (CUSIP)
US134429BS72
|
||||
| Deutsche Telekom | EUR 1,9bn |
4–12Y | 4,0–4,7% | Low |
|
ISIN (CUSIP)
XS3528376877…XS3528381281
|
||||
| Instituto de Crédito Oficial | EUR 0,50bn |
5Y | 3,7% | Low |
|
ISIN (CUSIP)
XS3526683621
|
||||
| International Bank for Reconstruction and Development | USD 1,5bn |
6Y | FLOAT, +37bp | Very Low |
|
ISIN (CUSIP)
US459058MD26
|
||||
| Kroger | USD 1,5bn |
5–10Y | 5,8–6,2% | Medium |
|
ISIN (CUSIP)
US501044EY35…US501044EZ00
|
||||
| LfA Förderbank Bayern | EUR 0,50bn |
7Y | 3,8% | Very Low |
|
ISIN (CUSIP)
DE000LFA2576
|
||||
| McGraw-Hill Education | USD 0,40bn |
7Y | 8,0% | High |
|
ISIN (CUSIP)
USU5802LAB54
|
||||
| Minerals Technologies | USD 0,40bn |
5Y | 7,5% | High |
|
ISIN (CUSIP)
USU60088AB41
|
||||
| NCL Corporation | USD 0,95bn |
5Y | 8,8% | Very High |
|
ISIN (CUSIP)
G6436QAX4
|
||||
| Paramount Skydance | USD 41,4bn |
2–40Y | 6,3–9,1% | High |
|
ISIN (CUSIP)
USU7010QAR30…USU7010QAQ56
|
||||
| Republic of Bulgaria | EUR 2,2bn |
5–18Y | 4,2–5,3% | Medium |
|
ISIN (CUSIP)
XS2716887760…XS2890435600
|
||||
| State of Schleswig-Holstein | EUR 1,0bn |
8Y | 3,8% | Very Low |
|
ISIN (CUSIP)
DE000SHFM1K6
|
||||
| Trinity Capital | USD 0,30bn |
5Y | 7,7% | Medium |
|
ISIN (CUSIP)
896442AM2
|
||||