- Markets had expected the BoE's bank rate hike, but they were caught a bit off guard by a surprising pivot by the ECB, widely seen as the most dovish of major central banks in wanting to hold off talk of any rate hikes until after 2022.
- ECB president Christine Lagarde noted that inflation rates were “tilted to the upside” and “getting much closer to target.” Lagarde’s sudden pivot has sent bonds in a new direction and rates on eurozone area sovereigns surged.
- The relatively calm conditions in US credit markets so far this year have been a distinct contrast to the volatile performance of equities. This is somewhat surprising, given how negative yields are on an inflation-adjusted basis. But conditions might be changing.
For further details see:
Here Come The Bonds