Francesco Garzarelli, co-head of global macro and markets research at Goldman Sachs, said global bonds will continue to sell off as the decreasing power of central bank stimulus leads to a correction following the post-Brexit rally.
Since Monday, yields on US 10-year bonds have risen 15bps, as investors back away from debt following concerns the Federal Reserve will raise interest rates at the central bank's meeting next week. This reversal of sentiment among investors comes despite a survey revealing that 85% of Wall Street economists expect the Fed to hold fire. In an interview with Bloomberg, Garzarelli said the sell-off is likely to continue as central bank-led stimulus measures such as quantitative easing, which has traditionally helped to compress yields, continue to lose effectiveness. He said the marke...
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