Neither argument holds right now for holding any tactical cash, especially with no reasonable prospects for a near - term rate increase and
the yield differential offered by bonds over cash right now.
That has caused U.S. - Japan and U.S. - German
yield differentials to widen further in the dollar's favor, leaving the yen and the euro lower.
Hint:
yield differentials are taking a back seat for now.
Overall, we are seeing a pickup in yields globally, resulting in narrower
yield differentials between U.S. Treasuries and other sovereign bonds.
Tonight I am including charts of the U.S / German two - year
yield differentials.
The TED spread is
the yield differential between three - month London interbank offered rate (Libor) and the three - month U.S. T - bill rate.
The more general forces that have influenced the exchange rate over the past year or so have been the relative strength of the Australian economy, the associated
yield differential in favour of Australian dollar assets, and the continued improvement in Australia's terms of trade, which are now at their highest level in more than 25 years.
The chart shows that a higher
yield differential between U.S. and German government bond yields in the past typically spurred more foreign purchases of U.S. bonds, supporting the dollar.
Future studies of cross-grade interventions may want to examine the use of multiple, parallel interventions, and whether the timing of their delivery
yields differential student outcomes.
The yield differential between Canadian and US bonds is likely to be quite small, and it will be completely overwhelmed by significant changes in the exchange rate.
As the US Federal Reserve is the only major central bank leading the departure from ultra-low rate policy, rising
yield differential (in favour of US versus others) can see a re-strengthening of the US Dollar in the short term.
It has helped put «
yield differential» back in the driver seat for global currency moves: this means higher US bond yields could drive the greenback higher.
There were also hedge funds that tried to exploit
the yield differential, borrowing short and lending long.
However, relatively little attention has been dedicated to the types of peer relationships that may be particularly potent for peer socialization to occur and to whether these different friendship contexts may
yield differential risk for peer socialization across different behaviors.
Not exact matches
With rates at near zero in the United States, and negative in Japan and Europe, the
differential is a powerful lure for carry trades, in which investors borrow at ultra-low rates in currencies such as yen or sterling and buy high -
yielding assets such as the kiwi.
It's not just that U.S. bond
yields go up, it's the
differential.
Because most wealthy Chinese seem to think about RMB in terms of USD or Hong Kong dollars, it is the fear that any depreciation of the RMB against those two currencies (the Hong Kong dollar is pegged to the USD through a modified currency board) greater than the couple of percentage points interest rate
differential would
yield less than equivalent USD or Hong Kong dollar bonds.
Over the past year, the bond
yield curve has been positive but flattening (short - term
yields remained lower than long - term
yields, but the
differential has narrowed).
For a period in early May, bond
yields in Australia had moved below those in the United States, i.e. the
differential had become negative.
At the same time, the carry between Chinese interest rates and U.S. Treasury
yields has now turned negative, meaning that there is no longer a favorable interest rate
differential to encourage Chinese investment in U.S. government debt.
In early August,
yields on 10 - year bonds were around 75 basis points above the cash rate, slightly less than the average
differential since the mid 1990s (Graph 66).
One can see that every time the
differential has dipped into the negative i.e. when the
yield inverts, the economy has fallen into a recession.
This study is good example of a precision medicine themed approach to showing how a mechanistic understanding of the
differential gene expression can
yield biomarkers that can be used for early detection of disease, as well as potential therapeutic targets.
In addition to precise
differential velocities, this survey will also
yield precise barycentric radial velocities for many thousands of stars using the data analysis techniques reported here.
Further scrutiny of the TW Hya disk with GPI and SPHERE in their
differential coronagraphic imaging modes may
yield direct detection of the planet (s) that appears to be actively carving a gap in the TW Hya disk — especially if the putative planet is still actively accreting gas from the disk.
The suspension and radiator are beefed up to handle the rigors of trail riding and a rear limited - slip
differential is added which
yields handling benefits both on and off - road.
All Tundra
differentials are made using new machining technology: «face hob» gear cutting for ring and pinion gears
yields stronger tooth form and a greater engagement area for increased torque capacity and reduced gear noise.
Well, besides the potential
differential between the annual percentage
yield on the loan, nothing.
Yield spread relationships do not reflect risk
differentials.
The BOJ's decision to anchor 10 - year Japanese government bond (JGB)
yields around zero has led to a yawning
differential with 10 - year Treasury
yields.
Having said that, we find validity in WHT
differential as a significant driver of performance when investing in high
yielding assets.
The basic premise is that large interest rate
differentials create ideal conditions for a long - term trend favoring the higher
yielding currency over the lower
yielding currencies.
The present value of the principal outstanding at the date of maturity is calculated at an interest rate
differential discounted at the «
Yield of Government of Canada Bonds» on the market with the equivalent term to maturity plus 0.90 %.
In other words, the «dividend
yield — 2 year Treasury
yield»
differential has almost no impact on the medium - long term direction of the U.S. stock market!
He also notes SMDV offers a superior
yield to the Russell 2000, adding that much of the potential return
differential of small cap dividend growers have over other small caps can be attributed to lower historical risk.
Small caps are generally more expensive than large caps, but when the
differential between their FCF
yields has been this narrow historically, small caps have outperformed.
The carrying value and the fair value of the facility as of December 31, 2007 represents the present value of the
differential in the spreads between the Company's credit default swap spreads and the
yield applicable to the CPCT facility.
The gain was due to an increase in the
differential between the Company's credit default swap spreads and the
yield applicable to the CPCT facility.
The EUR / USD moved lower declining for the 5th consecutive day as U.S.
yields continued to trend higher, widening the interest rate
differential between the
The EUR / USD moved lower declining for the 5th consecutive day as U.S.
yields continued to trend higher, widening the interest rate
differential between the U.S. treasury and the German bund.
On a relative basis, this equates to about 60 % more spread for a similar degree of credit risk.1 Spread
differentials are even larger versus European and Japanese corporates given the extremely low
yields in those regions.
The interest rate
differential helps pad the
yield paid to shareholders.
It become a difficult, and intractable problem which does not
yield to simple
differential equations applied to idealized columns of gasses in «ideal» states.
However, they should not base this «buy - term - and - invest - the - difference» choice solely on
differentials in potential
yields inside and outside the policy.