Is it right to use bond yields as a way of informing on future interest rate expectations? My understanding is bond yields are purely down to supply and demand for bond investments, and hence inform on all sorts of other variables in the economy, not least of which is the attractiveness of other alternative investments. Whereas interest rate swap rates do a far better job at informing on where the markets currently see interest rates being in the future. Comparing 6 month Euribor at end of June versus end of September, the 1 year forward rates stretching out 5 or 10 years from now have shifted upwards by around half a percentage point.
My interpretation of the curve is, in essence back in June the market thought interest rates would fall by around 1.5% over the next four years, and now it’s thinking that fall will only be 1% or so.
The best way to stop Farrage(or Braverman) taking over the Tory Party is to join as a member for £39 and vote in the leadership election for Mordaunt or Tugenhadt. They will let anybody "join" including people outside the UK.
Is it right to use bond yields as a way of informing on future interest rate expectations? My understanding is bond yields are purely down to supply and demand for bond investments, and hence inform on all sorts of other variables in the economy, not least of which is the attractiveness of other alternative investments. Whereas interest rate swap rates do a far better job at informing on where the markets currently see interest rates being in the future. Comparing 6 month Euribor at end of June versus end of September, the 1 year forward rates stretching out 5 or 10 years from now have shifted upwards by around half a percentage point.
My interpretation of the curve is, in essence back in June the market thought interest rates would fall by around 1.5% over the next four years, and now it’s thinking that fall will only be 1% or so.
The best way to stop Farrage(or Braverman) taking over the Tory Party is to join as a member for £39 and vote in the leadership election for Mordaunt or Tugenhadt. They will let anybody "join" including people outside the UK.