Stay informed with free updates
Simply sign up to the Sovereign bonds myFT Digest — delivered directly to your inbox.
The bond vigilantes are growling and baring their teeth, and authorities around the world (most of it, anyhow) are doing the right thing, and backing away. But the risk of bond wobbles spiralling in to a broader outbreak of nerves across markets is high.
From the US to the UK and Japan, bond investors are making it clear they are unwilling to be used as a low-cost cash machine for government spending for ever.
The circumstances for each country vary but the underlying force is the same: the world has changed. Inflation is higher, central banks are not soaking up bonds as they once did, and yet governments still want to borrow like it’s going out of fashion. Now, bond investors want to be rewarded properly for the risks.
The UK’s head of debt issuance, Jessica Pulay, said she would lean more heavily on short-term…
