Beware the bond price snapback, says BIS’s da Silva
Liquid bond markets and low yields may not last, warns deputy general manager
Emerging markets should prepare for the possibility of a sharp "snapback" in bond prices as current conditions unwind, the Bank for International Settlements' Luiz Pereira da Silva said in a speech last month.
The deputy general manager made the remarks at his former employer, the Central Bank of Brazil, and warned that although bond markets are currently liquid and financing costs low, this could change suddenly.
Da Silva said economists are "still struggling" to understand inflation dynamics
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