IT IS a brave investor who calls the end of a four-decade trend. But bond yields have risen so far and – in recent weeks – so fast that many market participants now believe the era of low interest rates to be over.
Since early August America’s 10-year Treasury yield has traded in excess of 4 per cent, a level unseen from 2008 to 2021.
On Oct 3, it hit a 16-year high of 4.8 per cent, having risen by half a percentage point in a fortnight.
The moves have spilled over globally: to Europe, where they threaten to bring about a fiscal crisis in indebted Italy; and Japan, which is clinging on to rock-bottom interest rates by its fingertips.
What is going on? Start in America, with some financial...
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