In the aftermath of the immediate surge in yields triggered by Donald Trump's election and the subsequent Republican sweep, government bond markets returned to a more normal state. By the month's end, global government bond yields showed a downward trend, with Germany leading the way among developed markets with the 10-year bund falling 30 basis points(bps). The United Kingdom’s 10-year gilt followed closely, decreasing by 20 bps, while the 10-year U.S. Treasury yield declined by 12 bps. The U.S. dollar demonstrated strength during the month, outperforming a basket of other currencies by 1.7%.

Emerging market (EM) local government bonds outperformed their developed market counterparts, as yields generally decreased across the board. However, Brazil deviated from this trend, experiencing a notable rise in its 10-year rate, which increased by 62 bps.