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Bond sell-off worst since 1949, says Bank of America

Robert Besser
27 Sep 2022, 20:58 GMT+10

LONDON, England: If worldwide government bond losses continue, 2022 marks the worst year since 1949 as investor sentiment falls to its lowest since the financial crisis began after the Russian invasion of Ukraine, according to a report issued by the Bank of America Global Research department.

For the week ending September 21, bond funds reported outflows of $6.9 billion, as an additional $7.8 billion was taken out of equity funds.

Further, Bank of America said that investors converted $30.3 billion into cash in recent weeks.

Additionally, speculative purchases of the dollar have resulted in multi-year highs.

It was further reported that investor sentiment remains the worst it has been since the 2008 global financial crash.

U.S. Treasury yields, which move in the opposite direction of bond prices, have reached their highest level since 2011, as the U.S. benchmark 10-year yield reached some 3.76 percent.

Bond sell-offs are expected to be ongoing as long as central banks worldwide continue with aggressive rate hikes, in a bid to contain inflation.

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