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Bond Traders’ Wild Ride

Bond Traders’ Wild RideBond Traders’ Wild Ride

You’ve traded on inflation data and the prospect of rising sovereign-debt supply. You’ve wagered on Federal Reserve meetings and what the next chairman might do. And you’ve bet on jobs and wage growth that exceed or miss targets. Now try doing it all in one week, Bloomberg reported. With yields threatening to leap higher, bond traders will grapple this week with market-moving stimuli coming at breakneck speed. The selloff in treasuries less than a month into 2018 has already sparked calls of a bear market, including from Ray Dalio, founder of hedge fund Bridgewater Associates. US domestic events are about to take center stage, after decisions by the Bank of Japan and European Central Bank left 10-year yields close to the highest since 2014. Traders will have a few things on their minds: Janet Yellen’s final meeting as Fed chair, the treasury’s plan to cover widening deficits, and, to cap it all off, an update on the US job market. “It seems almost impossible how much is jammed into one week,” said Michael Lorizio, a senior trader at Manulife Asset Management, which oversees $383 billion.

 

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