Australian interest rates Australian Shares

How far can the bond rally get?

Tuesday, 20 April 2021

As usual, the accelerated COVID business cycle that we have dubbed the Amphetamine Cycle, is moving at a lightening pace. Previously, I’ve described the contest of market narratives as good news is good news, good news is bad news and bad news is good news.

Q1 was defined by good news is good news with rising yields and stocks plus a strong DXY. Q2 has shifted to bad is good news with falling yields, rising yields and weakening DXY. What comes next?

Capital Economics has a crack:

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.