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Markets

Brexit sends U.S. bond interest rates to record low

Opening sequence

Opening sequence

Markets

Brexit sends U.S. bond interest rates to record low

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17:18
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COMING UP:Brexit sends U.S. bond interest rates to record low

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Transcript

00:00:01
>> The Brexit bear trade is back on, and investors are running to the safest place they know, bonds backed by the full faith and credit of the US government. I'm Conway Gittens in New York. All that demand is pushing interest rates for US government bonds to its lowest ever.
00:00:18
On Tuesday, the yield on the ten-year note falling to 1.35%. That means rates on mortgages, car loans, and other lending products could go even lower, a relief to borrowers, all in a time when many expected the direction of rates to be up, not down. But hold on, uncertain times makes for a nervous loan officer, who might not be so willing to give out a loan until the economic picture is clearer.
00:00:46
Besides, rates have been low since the financial crisis, so many who wanted to take advantage of low rates already have. And it's not just political uncertainty that's driving interest rates to record lows, weak economic data out of China and the US, the latest reminder the global economy still hasn't gotten back on its feet.
00:01:05
The sliding rates having an immediate impact on financial stocks, just one more headache for a sector whose business is challenged on many fronts. They led the stock market lower along with companies exposed to the global economy. Think Dow Chemical, Dupont, and Monsanto. And there was also renewed pain for oil prices Tuesday, oil having its biggest one day drop in five months.