“The Only Asset That Matters Right Now” – Treasury Correlations Have Never Been Higher

In a week in which there is not one but two critical central bank announcement within hours of each other on September 21 – first the Fed, followed hours later by the Bank of Japan – there is just one asset traders should keep an eye on: the 10Y Treasury.
As Goldman shows, as a result of an unprecedented scramble for duration over the past year courtesy of global NIRP, the sensitivity to bond yields is at its all time highs across all assets, which means whatever the 10Y does, everything else will do, especially as a result of the ongoing rout in risk-parity and systematic funds which create a positive selling (or buying) feedback loop.

This post was published at Zero Hedge on Sep 18, 2016.