Cracks Everywhere: Japanese Yen, AI Stocks & US Bonds

Global macro volatility centers on Japan’s shifting interest rate policy, which threatens to unwind the yen carry trade and trigger significant capital repatriation from Western bond markets. Rising US 10-year yields, driven by supply concerns rather than economic growth, signal a disconnect between the bond market and equity valuations, particularly within the capital-intensive AI sector where rising costs challenge future profitability. Meanwhile, gold remains a critical hedge against global currency instability and persistent geopolitical conflict. Central bank demand for gold continues to reach record levels, reinforcing its role as a foundational asset. The introduction of 24/7 gold futures at the CME Group reflects a broader shift toward increased accessibility and transparency in commodity trading, providing market participants with essential tools to manage risk in an increasingly fragmented and uncertain global financial landscape.