The rise in bond yields: A message or a blip?
Over the past two months the sell-off in government bond markets around the world has been pronounced raising the question of whether there is a change approaching in the global economy? Is the era of slow growth, low inflation and low interest rates coming to an end with the world starting to reflate and central banks starting to worry more about the risk of inflation, or is the back-up in bond yields a large blip in markets that had rallied too far? Our view is that the rise in bond yields is a blip even in the United States where the Federal Reserve continues to prepare markets for the first official interest rate increase in a decade. The upward move in Australian bond yields is most clearly a blip in our view given that the risk of recession in Australia, although still small, is higher than it was a few months ago. To read more regarding the change in bond yields and the implications for the Australian Sharemarket click here: (VIEW LINK).
Altair Asset Management (Altair) is a high conviction, active Australian equities manager whose investment philosophy is based on understanding the drivers and impact of change. Altair applies macro thematic research to uncover trends which are...
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