Core Viewpoint - BlackRock Investment Institute upgraded the rating of European government bonds from slightly underweight to neutral, citing the attractiveness of eurozone bonds compared to U.S. Treasuries [1] Group 1: Investment Outlook - The institute believes that eurozone government bonds and credit markets offer more attractive yields than U.S. bonds [1] - The increase in term premium has brought yields closer to the institute's expected levels [1] Group 2: Economic Context - Persistent inflation in the U.S. prevents the Federal Reserve from significantly lowering interest rates [1] - The large scale of the U.S. fiscal deficit may lead investors to demand higher returns for holding long-term U.S. Treasuries [1] Group 3: Regional Preferences - Within the eurozone, BlackRock favors bonds from non-core members such as Italy and Spain [1]

Group 1 - European government bond yields have slightly increased following the release of U.S. data [1] - The latest yield for Germany's 10-year government bonds is 2.598% [1]

Group 1 - The Bank of Japan officials are not in a hurry to intervene in the bond market despite rising pressures on Japanese government bonds [1][5] - The passage of Trump's tax reform plan has intensified global fiscal concerns, leading to a broad sell-off of long-term bonds across major economies, including Japan and Germany [1][3] - The 40-year Japanese government bond yield reached a historic high of 3.689%, while the 30-year bond yield hovered around 3.187% [3] Group 2 - Global investors are currently unfavorable towards long-term bonds due to concerns over inflation and economic outlook, which are impacting their willingness to hold such assets [4] - The rapid rise in Japanese bond yields is raising concerns that it may exacerbate the situation for U.S. Treasuries, as Japanese investors may start to repatriate funds back to Japan [6][7] - The potential for a sudden shift in Japanese investor behavior could lead to further downward pressure on U.S. bonds and the dollar [7]