The past few weeks have seen global government bond market prices sell off (rising yields) due to worries about the spike in global energy prices from the Iran War creating problematic inflation, and in turn, prompting central banks hold their interest rates steady or even tighten their monetary policies.
More recently, however, bond traders’ attitudes have flip-flopped as prices this week have rallied (lower yields) due to revised notions that a prolonged war in Iran, including the associated higher energy costs, would be a significant drag on world economies, prompting central banks to lower their interest rates.
