Broader U.S. financial conditions have tightened rapidly: The 10year Treasury yield has risen more than 200 basis points since the beginning of the year and is near its highest level in over a decade at 3.8 percent. At a global level, monetary policy tightening is also proceeding at a rapid pace by historical standards.
Including the Federal Reserve, nine central banks in advanced economies accounting for half of global GDP have raised rates by 125 basis points or more in the past six months. 2 Global financial conditions have likewise tightened.