The rise in longer-term US and developed-market bond yields risks becoming entrenched as fiscal largesse becomes a feature of economies, rather than a temporary bug.
The climate in markets will continue to be dictated by enormous, procyclical fiscal deficits. Yields around the world may have come off in the last day or two as concerns on the economic outlook bounce back into vogue, but the cyclical ebbs and flows of growth are merely the shorter-term picture.
