The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site. Please see our Subscription Terms and Conditions.


All material subject to strictly enforced copyright laws. © 2022 Euromoney, a part of the Euromoney Institutional Investor PLC.
BANKING

Bond Outlook June 18th

Inflation and recession together, and central bankers recognising that they had better fight the former now than risk a greater recession later: what does that mean for fixed-income investors?

Bond Outlook [by bridport & cie, June 18th 2008]

Three major questions this week are of key importance to fixed-income investors adjusting their strategy. We shall give our own answers and seek the conclusions to which they lead:

Question 1: is the negative impact of the credit crunch on the economy now almost over? No, far from it. Real losses from defaults have yet to be recognised, and the impact of a serious credit squeeze has scarcely begun. Be very careful of accepting at face value any announcements by those in authority to the effect that the worst is over.

Question 2: is inflation under control? No, and it is likely to get worse.

Question 3: are central banks serious in their intensions to fight inflation by raising interest rates? Of the three questions this is the most difficult to answer, especially when so many respected commentators are asking whether Bernanke and Trichet have taken leave of their senses in speaking of higher rates when the economy is in such trouble.

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.

SUBSCRIBE ONLINE TODAY

Unlimited access to Euromoney.com and Asiamoney.com

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually

FREE 7 DAY TRIAL

Unlimited access to Euromoney.com and Asiamoney.com, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors

LOGIN NOW

Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree