Markets are turning away from bonds and into assets like Bitcoin as “safe haven” stores of value as global war conflicts heat up, an Allianz Economist told CNBC in an interview last week.
The Federal Reserve has been steadily shrinking its balance sheet since last year to take money out of the economy and help combat soaring inflation. Since inflation is yet to reach the Fed’s 2% target, more sales are expected, thus pushing bond yields higher. “We haven’t seen the flight to quality and flight to safety you would expect given what’s happening in the world,” said the economist.
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