Bund blip shows just how fast the market mood is changing
This year opened with growing certainty that the Fed would raise rates three times this year. Now, markets are tilting heavily towards the view that it could be four.
Not to be alarmist, but something truly bizarre happened in the financial markets last week: For a brief period, investors were being paid to buy debt issued by Germany, the famously prudent government borrower. What witchcraft is this?
This is some of the safest debt on the planet – so attractive to global investors that demand had pushed benchmark 10-year yields into negative territory since 2019. That meant investors effectively had to pay to hold German government bonds.
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Financial Times
Katie Martin is the Financial Times' capital markets editor.
