After Prolonged Period Of Unchanged Rates - Bond Complacency
Alhambra Investment Partners, LLC | Nov 29, 2015 02:43AM ET
This chart from our strategic macro research partner shows the incredible length of stimulus.
Has the current, prolonged period of unchanged Fed policy rate of 0% conditioned investors to think this level of interest rates is the new normal? The FOMC looks to be ready to embark on a period of raising interest rates. If 10-Year bond yields move higher by just 25 basis points, the income received is wiped out by capital losses. Official Fed projections predict yields above 3%. Nominal growth readings suggest the same.
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