Developed market government bonds remain under pressure as the hawkish wave swept across G10 central banks. Last week, the Fed and BOJ both hiked by 25bps as widely expected. However, there were two nuances to note. Fed Chair Warsh managed to out-hawk already hawkish pricing heading into the FOMC meeting. This triggered another push higher in 2Y yields as the market front-loaded hike expectations. The long-end was slightly more anchored and the USD firmer amidst greater conviction that the Fed would hike as economic conditions warrant. By contrast, the BOJ governor Ueda did not manage to meet lofty investor expectations. While the BOJ did hike by 25bps, there were two dissents and his comments were judged to be not sufficiently hawkish. Yen weakness was the result. 
In any case, from the rates perspective, four out of G10 central banks (ECB, RBNZ, the Fed and BOJ) have hiked this month. The BOE refrained from moving this month, but expectations of hikes remain elevated. The market is also expecting the RBA to resume hiking later this month. We see little signs that bond markets are done. Momentum for higher yields remain in place even as yield levels already look very elevated. Implied real yields (10Y > 2.5%) are also very high. Typically, this would have already caused financial conditions to tighten, triggering risk off. However, despite nominal and real yields at these levels, there are no obvious signs of credit spreads widening or stocks having a meaningful drawdown. We would be wary of calling a top in yields just yet. 
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