Scenario Analysis: What if bond yields rise? – Newscape Capital Group

With Bank of Japan (BOJ) engineering a steeper yield curve and talk of December Fed rate hike gathering pace, everyone is thinking about ‘what if the bond yields rise’.

A well known fact is that rising long duration yields would definitely hurt stock markets. However, pockets of growth would still be available with rising yield. Banks could benefit from rising yields.

Charlie Morris, Head of Multi-Asset, Newscape Capital Group says the Fed is trying to tighten slowly… very slowly and at the same time provide stimulus by talking down the US dollar. He adds, ‘if yields rise sharply, the high growth stocks would become the new safe havens”. This is a must watch segment as we seem to be heading towards an era of rising yields.