PIMCO | The American privilege is fading

"U.S. Treasuries long carried a “convenience yield” – a premium investors paid for the liquidity and safety of dollar assets compared with other high quality sovereign bonds."

"Over the past decade, that gap has evaporated, shrinking from nearly 80 bps to roughly 0 when adjusting German bund and Japanese government bond yields hedged back into dollars using maturity-matched cross currency swaps."

"What’s striking is that the premium hasn’t returned even after recent risk-off episodes and geopolitical shocks – conditions that historically pushed the gap wider." - PIMCO