The global rally in bonds on Thursday drove the yield on the benchmark 10-year Treasury below 1.5 per cent for the first time since August 2016.

The yield fell as much as 11 basis points to 1.47 per cent on concerns about the rising risk of recession around the world and as U.S.-China relations deteriorate. The rush to buy haven assets drove the yield on the U.S. 30-year bond, the longest-maturity Treasury security, to a record low below 2 per cent earlier in the session. U.S. stocks were also lower on the day and the dollar slid.

Though the 10-year yield pulled back to 1.52 per cent in subsequent trade, it’s likely to test its all-time low of 1.32 per cent, says Tom Garretson, rates strategist at RBC Wealth Management.

“Until we have some clarity on trade and how serious the Fed’s going to get about fighting the inversion of the yield curve, I think for now the momentum is lower,” Garretson said.

Absent any new breakthrough in trade negotiations, the best chance for stabilization in the 10-year yield is if the Fed steps in to signal it’s ready to cut rates, he said.

In the meantime, economic data can do little to ease the market’s pessimism about the global economy. Soft Chinese and German economic data fueled this week’s rallies in global rates, which have taken the German 10-year yield to -71 basis points. Thursday’s U.S. retail sales figures, which showed the consumer remains in fine form, had barely any market impact.