The trading climate in the $22tn US government bond market has become less hospitable, adding to choppy moves in securities that act as a foundation of the global financial system.
Liquidity — the ease with which an investor can buy or sell an asset — has deteriorated in recent weeks, data show, adding to pressure on regulators to improve a market long viewed as a haven during times of trouble.
But regulators are far from any solution, according to a progress report released this week by a federal working group charged with assessing the structure of the US Treasury bond market.
The report, part of a review commissioned after Treasury markets were thrown into chaos at the start of the coronavirus pandemic, detailed why there have been liquidity problems in recent years. It also outlined familiar solutions, such as increased transparency and oversight and central clearing.
It stopped short of making any policy recommendations and did not suggest a timeline for the work.
Thanks for reading FirstFT Europe/Africa. Here’s the rest of today’s news — Gary
Five more stories in the news
1. Facebook whistleblower calls for online harm controls Frances Haugen warned that the EU and the UK “will have missed a huge opportunity” if they do not broaden the scope of new digital laws to force tech companies to keep harmful content off their sites. She testified before the European Parliament on Monday.
2. GE to split into healthcare, energy and aviation companies General Electric plans to break into three separate companies, effectively ending its status as America’s best-known industrial conglomerate after years of trying to respond to flaws in its model exposed by the financial crisis.
3. EU accuses Belarus’s Lukashenko of exploiting migrant crisis EU and Polish officials believe the surge in migrants on the bloc’s eastern border is being engineered by Belarusian strongman Alexander Lukashenko in retaliation for the Brussels’ support of the country’s opposition, which has faced a vicious crackdown, and in an effort to force sanctions relief.
4. DoorDash buys Finland’s Wolt in €7bn deal DoorDash has reached an all-stock deal worth €7bn to acquire Wolt. The Helsinki-based delivery operator has more than 4,000 employees and operates in 23 European markets including Germany, where DoorDash is eager to gain a foothold.
5. Macron pushes Covid boosters for over-65s President Emmanuel Macron has announced that over-65s in France will need Covid-19 booster jabs if they want to eat out or make long-distance journeys from next month, a move that suggests all French adults will eventually require a third injection against the virus to live normally.
COP26 digest
The UN has found that 2030 climate targets are still far off track from Paris agreement goals and would increase temperatures up to 2.7C by 2100.
A global deal to eliminate new car emissions by 2040 is struggling to attract support from carmakers and governments including the US and China.
Global greenhouse gas emissions from agriculture and food production have risen 17 per cent over the past 30 years, according to UN data.
About 130 fashion brands have pledged to halve greenhouse gas emissions by 2030, but the industry will fall well short based on its present trajectory.
US Democrats attending COP26 attempted to inject a positive tone into talks that remain stymied by a lack of political capital in Washington.
The day ahead
Inflation data The US reports monthly inflation data, which are forecast to show consumer prices rose 5.8 per cent in October year on year, the highest level of increases since 1990. Germany also reports inflation data.
Rivian begins trading The Amazon-backed electric vehicle maker is set to list in New York in the biggest initial public offering for a US company since Facebook’s debut in May 2012.
Earnings Results are expected from ABN Amro, Adidas, Allianz, Crédit Agricole, EDF, Infineon Technologies, Marks and Spencer and Walt Disney. Read the full list here.
What else we’re reading
England’s GP shortage points to need for new model The much loved general practitioner is a national trope. But burgeoning demand from a population needing ever more complex care, with fewer doctors to deliver it, is putting the model under strain and driving demands for radical reform.
‘Britain’s game of Brexit chicken will end badly’ In threatening to repudiate its deal with the EU, the UK is undermining its credibility as a reliable partner. This is dangerous not just for the UK, writes Martin Wolf, but also for the EU and wider west.
The WFH revolution has not benefited everyone Older people were staying in work for longer — until the pandemic hit. Now an army of “Covid retirees” is heading for the labour market exit, writes Sarah O’Connor.
Looming clash over Argentina’s $57bn bailout As Argentina faces down a deadline to repay billions of dollars from a record-breaking $57bn IMF bailout, the leftwing government in Buenos Aires needs a fresh deal to unlock more cash to relieve an economic crisis. But President Alberto Fernández is hardening his line ahead of midterm elections on Sunday.
Asia opens its post-Covid economies China may have among the most severe restrictions on the continent, but critics argue that curbs are still too strict in countries such as Japan, South Korea and Singapore as they begin to open up. “Politically and for businesses this [route] has been contentious,” said one executive.
Do you think Covid restrictions are still too stringent where you live? Tell us what you think in our latest poll.
Music
Concert halls do not often ring with chanting from the audience, but the Barbican did last week. With tongue in cheek, life-long Arsenal fan Mark-Anthony Turnage wrote a score depicting the team’s league-clinching win over Liverpool in 1989, which was shown alongside a film of the match.
