RISING BOND YIELDS ARE AFFECTING THE INVESTMENT ENVIRONMENT

 

In global financial markets, rising energy prices and stronger than expected U.S. economic data are reshaping expectations for inflation and the future path of monetary policy. At the same time, U.S. Treasury yields have reached multi year highs, with the 10 year yield recently rising to its highest level since 2007.

Higher bond yields can raise benchmark borrowing costs and investors’ required rates of return, potentially increasing the cost of raising capital in international markets. Higher yields on fixed income securities can also put pressure on non interest bearing assets such as gold by making yield generating investments relatively more attractive.

According to Bloomberg, gold was trading at around USD 4,290 per ounce after declining 1.7% in the previous session, while silver had fallen by around 4% in the prior session.

UBIM works to enhance the investment readiness of Ulaanbaatar’s projects and programs and to develop financing structures based on non budgetary funding sources. In this context, incorporating changes in global interest rates, bond yields, and exchange rates into assessments of financing costs, maturities, and risk conditions is essential for making sound investment decisions and structuring financing efficiently.