Bond yield rise a vote of confidence

By Justin Still
Updated January 24 2017 - 1:15pm, first published 12:55pm
Justin Still
Justin Still

The market in context 

The most important event for equity investors in 2016 hasn’t been about Brexit or Trump, but about the reversal in the multi-year downward trend in government bond yields off their abnormal lows set in early July. This is effectively a market vote of confidence in the outlook for inflation (and growth) based largely on the steady US economic recovery. The surprise election of Donald Trump didn’t trigger rising bond yields, but did accelerate it. Trump’s economic agenda offers a plausible route to stronger US, and potentially global growth. 

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