But traders are embracing risk in the bond markets as well. Spreads have narrowed for Asian dollar bonds in 2019, which means that investors are demanding less compensation for holding riskier debt. The cost of default protection has also declined. The cost of insuring South Korean government debt against default, for example—as measured by credit default swaps—slipped to a record low Monday. Part of the shift comes down to indications that the Federal Reserve might be done with rate increases, at least for now.

Source: Wall Street Journal February 18, 2019 02:00 UTC