Bond Market Selloff Erases Thanksgiving Week Gains on Japan Concerns

Global bond markets are experiencing sharp weakness to start December, with the selloff effectively erasing last week's Thanksgiving rally. Market participants point to concerns about potential Bank of Japan policy shifts as a key catalyst for the volatility. The rapid unwinding of positions highlights the fragility of recent market gains during the typically thin Thanksgiving trading period. US Treasury yields are climbing across the curve, pressuring risk assets and supporting the US dollar. The correlation between bond weakness and currency movements suggests a broader risk-off sentiment developing in markets. Technical analysis shows bonds breaking below key support levels established during November's rally. This morning's price action reflects heightened uncertainty about global monetary policy divergence, particularly between the Fed and BoJ. Forex traders should expect increased volatility in JPY crosses and safe-haven flows.