To say this has been a challenging year in fixed income is an understatement. Once again, the bond market has discovered that the assurances of central bankers (or rather their economic forecasts) aren’t worth the paper they are written on. Instead, like the rest of us, central bankers are simply slaves to the data, only with a slower reaction function. Therefore, as the numbers change, their apparent rock-solid resolve at first wavers and is then simply cast aside. In that sense, they are the very definition of the “unreliable boyfriend”.
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