Fast-Rising Bond Yields Spark Concerns of Economic Slowdown as Central Banks Hike Rates
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Rising bond yields globally are raising concerns about economic risks as central banks hike rates to curb inflation.
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The pace of the bond yield increase has been very rapid, even as central banks signal rate hikes are nearing an end.
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There are spillover effects possible, like budget strains in emerging markets that could create crises.
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Unanticipated tightening of financial conditions from the bond moves could slow growth by straining budgets.
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The big risk is if bond yields keep rising quickly, leading to insolvencies or fire sales that reverse economic growth.
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