Goldman Says U.S. Bondholders Risk a $1.1 Trillion Hit if Rates Spike
ByFirst they came for the yield, then they came for the duration.
A Goldman Sachs Group Inc analysis says investors could be mired in a world of pain if yields on long-dated assets snap higher. Just a modest backup in rates could inflict outsized losses on bond portfolios — a sobering prospect in light of the recent jump inlonger-dated bond yields that’s already eating into bondholders’ capital returns.
A 1 percent increase in interest rates could inflict a $1.1 trillion loss to the Bloomberg Barclays U.S. Aggregate Index, analysts at Goldman calculate, representing a larger loss for bondholders than at any other point in history. With the bank predicting the selloff in bonds has further to run, that remains “far from a tail scenario,” its analysts write…
Goldman Says U.S. Bondholders Risk a $1.1 Trillion Hit if Rates Spike
