Bond yields across the developed world have plunged. Why are we here and where are we going?

Investors globally buy bonds because they provide a steady income with relatively low risk. A bonds yield shows how much income it will generate annually. This yield, derived by dividing the interest payment by the price, falls as the price rises. Bond yields also tell us a lot about the economy, with lower yields pointing to slower growth.  The following article and detailed graphs in the WSJ on 23rd of September accurately illustrated many of these issues facing the global fixed income markets.

 

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