Connect with us

Hi, what are you looking for?


Why the bond market has become jumpier | The Economist

Before the ball was struck, Mr Ramsdale was on his toes, his weight distributed evenly, ready to jump in either direction.

A market in which bets are slanted in one direction is vulnerable to a big swing in prices the opposite way.

You conclude that the Federal Reserve will have to raise interest rates sooner than people expect and a lot sooner than the European Central Bank.

In the event of unexpected news that is positive for the euro, the speculators who are short the currency would be nursing losses.

Perhaps this is why a lot of the recent discussion of volatility has been focused on liquidity—how easy it is to get in or out of a position quickly.

In the halcyon days before the financial crisis, there were marketmakers who were willing and able to lean against momentum, to take a view based on fundamentals, and to hold bonds for more than a day .

In this regard, the bond market is like a goalkeeper who gambles on where a free kick is going.

…Read the full story

Advertisement. Scroll to continue reading.

You May Also Like

TS Prime

Every calendar quarter the World Gold Council publishes its Gold Demand Trends report. On November 1, 2018 it published its report for July 1...


Nicosia, Cyprus, 26June,2021, ZEXPRWIRE, When a new project enters the market, establishing brand credibility is crucial, which is exactly what ADAX has done via...


Medical marijuana has become the hottest crop in regards to treating a wide range of common ailments, from chronic pain to PTSD, and Colombia...

TS Prime

In an announcement last Wednesday the German Government announced it would fund a research facility in the country to develop new technologies for EV...