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Investing.com -- Bank of England (BoE) Governor Andrew Bailey expressed his desire for less volatility in medium and long-dated bond yields on Tuesday. These yields have been affected by speculation surrounding U.S. President Donald Trump’s trade policies. For investors seeking deeper insights into bond market dynamics, InvestingPro offers comprehensive yield curve analysis tools and real-time global bond market indicators.
In January, British government borrowing costs experienced a surge, then subsequently eased as investors tried to assess global inflation risks in light of Trump’s proposed tariffs on trade partners. Bailey noted that the policy announcements from Washington on tariffs were causing fluctuations in the term premium, the extra interest that investors demand for holding longer-dated debt.
Bailey also agreed with recent comments made by the new U.S. Treasury Secretary Scott Bessent. Bessent stated earlier this month that he and Trump were working to control yields on 10-year U.S. government debt. Bailey commended Bessent’s wisdom in focusing on that part of the yield curve.
The BoE governor reiterated his warning that trade barriers could negatively impact global economic growth, although the effects on inflation remain uncertain. Bailey explained that the impact of tariffs on a country’s inflation is ambiguous, as it depends on trade redirection, any responsive measures taken, and the reaction of exchange rates.
He made these comments at an event in Brussels hosted by Bruegel, a think tank. Investors looking to navigate these complex market conditions can access detailed economic impact analysis and global trade indicators through InvestingPro’s advanced analytics platform.
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