Deutsche Bank Says Bearish Bond Narrative Has Gone Too Far
· Business · Bloomberg, TASS
Deutsche Bank AG’s global head of FX research, George Saravelos, stated that the swing to deeply-negative sentiment on fixed-income assets has gone too far. In a note following client meetings in the US, Saravelos said the market is underpricing the risk of an artificial intelligence blowup that could trigger a rush into bonds. Clients expressed concerns that AI is a major driver of higher yields and that the US Treasury has lost control of the long end of the market. These factors have fueled investor speculation about a potential suspension in 20-year Treasury issuance, alongside overwhelmingly bearish sentiment on French debt following a recent selloff.
Why it matters
Shifting investor sentiment on fixed-income assets directly impacts global bond yields, government borrowing costs, and market stability.
Read the original report — Bloomberg
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