Global bond markets face the biggest amount of net sovereign issuance so far this year in June, just as economic data throws rate cuts into doubt, testing...
LONDON - Global bond market s face the biggest amount of net sovereign issuance so far this year in June, just as economic data throws rate cuts into doubt, testing investors' so-far strong appetite for the debt.
"We still have a lot of supply that needs to be absorbed," said Camille de Courcel, head of G10 rates strategy for Europe at BNP Paribas, adding that the euro zone will see its second highest month of net issuance so far this year in June. Central banks, meanwhile, are reducing their bond holdings in a process known as quantitative tightening. The Federal Reserve has been allowing $95 billion of government and mortgage-backed bonds to mature without replacement each month, although that is set to slow down from June, while the Bank of England is actively selling debt back to the market.Investors have so far been eager to step in, with Britain receiving record demand for an inflation-linked 30-year bond in March.
"That has never proven to be a huge issue," Weidner said. "Banks...will take on, I believe, a substantial part of the gross supply, being well aware of the fact that redemptions in the following month will be higher, and they will be able to set up to sell the book." "At some point, if we continue to see mounting deficits around the globe at this level, then you should see investors demand a higher risk premium to lend, especially for longer maturities," said Michael Goosay, global head of fixed income at Principal Asset Management.
Today's rally isn't a durable bull run, but is driven by investors who want to "grasp the suds of yesterday's bubble," John Hussman wrote.BCE has a higher dividend yield than Telus . Is it a better buy? The post Better Buy: Telus or BCE Stock appeared first on The Motley Fool Canada.2 Soaring Stocks I’d Buy Now With No Hesitation
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