Should yield curve control go global, it would cement markets' perception of central banks as the buyers of last resort, boosting risk appetite, lowering volatility and intensifying a broader hunt for yield. Where central banks set their target will be key and could send assets swinging either way. Lower yields in longer maturities would assist investment-grade companies, which tend to issue longer-dated debt than lower-rated borrowers. Regardless, the notion that central banks are approaching some sort of curve control is here to stay. "Policy makers tightened up the banking system so much the markets became too big to fail," said Mark Nash, the head of fixed income at Merian Global Investors in London.

Source: Irish Independent June 22, 2020 01:30 UTC