Irrational Bond Markets Offer A Great Opportunity

By Dhaval Joshi, chief strategist at BCA Research

Executive Summary

• 30-year bond yields in the US, Japan, Germany, and the UK have moved in lockstep through the past two months.
• This is irrational because the fundamental drivers of bond yields – creditworthiness, inflation expectations, and debt sustainability maths – have not moved in lockstep.