With blistering inflation and hawkish Fed, bond investors push for safety

Published by
Reuters

By Gertrude Chavez-Dreyfuss NEW YORK (Reuters) -Bond investors are embracing safety in their portfolios as volatile markets price in a super-sized hike from the Federal Reserve following evidence of scorching inflation. Investors have drastically shifted their expectations about Wednesday’s decision to a rate hike of 75 basis points (bps) – not the 50 bps the market was expecting last week. The increased hawkishness has sent equity markets tumbling and bond yields surging, briefly inverting the yield curve and pushing stocks into a bear market. Many investors support the Fed moving faster to d…

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