Global Bond Yields Rise as Markets Expect Inflation to Persist Longer, ECB Seen Acting in June

According to Anthony Willis, senior economist at Columbia Thread Investment, on May 19, global bond yields are rising sharply as financial conditions tighten and markets expect inflation to remain elevated for an extended period due to higher energy costs.

Willis expects the European Central Bank to raise rates first at its June meeting, followed by the Bank of England in July. He noted that market expectations for the Federal Reserve have shifted significantly from anticipating aggressive rate cuts under new leadership to pricing in rate increases over the next 12-18 months.