Moribund Inflation Igniting Dash for Bonds From Europe to U.S.
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Inflation is moribund and bond buyers love it.
As crude oil leads a collapse in commodity prices, a German gauge of the outlook for inflation over the next five years has fallen below zero. With no increases in consumer prices in sight, bondholders’ interest and repayments are worth more, inflaming demand for fixed income. The longest maturities are setting the pace from Europe to the U.S.