This article will bring you to the list of the countries with the highest 10-year bond yields today. Insider Monkey has recently published an interesting article about it. There are various types of government bonds, but usually most of them entitle the investor to periodic interest payments and the return of the principal amount once the maturity date of the bond expires. Governments that issue bonds usually specify the amount and the coupon (interest) and then auction them off. Once on the market, bonds change hands repeatedly and because the bond price fluctuates based on the market demand while the coupon stays the same, investors can get higher or lower profits from their bonds.
Now without a further ado let’s see what Insider Monkey has investigated for us. We have picked three countries with the highest 10-year bond yields today from their list.
The first one is Mexico. For the first half of the year, Mexico’s 10-year bond yield was well above 7%, but slid below this mark in June. In the first half of August, Mexico hit an inflation rate of 6.59%, the highest in the first half of any month since June 2001. The Bank of Mexico has been consistently increasing interest rates, but in August left them unchanged at 7%. The next country on our brief list is Russia. Due to its dependency on oil, Russian economy was hit hard by the drop in oil prices. With the economic sanctions and a declining currency that led to an outflow of capital, the Russian economic growth slowed down to 0.7% in 2014, when the first round of sanctions was imposed over the Russian invasion of Crimea, and the GDP declined by 2.8% in 2015. At the same time, inflation rate amounted to 7.8% in 2014, 15.5% in 2015 and 7% in 2016. In turn, this sent the bond yields rallying. The Russian 10-year bond yield has surged above 10% towards the end of 2014 and reached a high of 15.9% in December. For the last choice, let’s see the numbers of South Africa. Since the beginning of 2016, the 10-year bond yield in South Africa has been declining from 9.6% amid slowing inflation. Last month, the inflation in the country reached 4.6%, the lowest point since September 2015. With lower inflation, the South African Reserve Bank cut the interest rates for the first time in five years.
For any further useful information, read Insider Monkey’s article about 10 countries with the highest 10-year bond yields today.