Treasuries Face Risk of ‘Mini Taper Tantrum’ in 2021, MUFG Says
- Market, analysts may be underestimating economic rebound
- Herrmann says U.S. jobless rate could fall to 4% or below
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The bond market is underestimating how strongly the U.S. economy will rebound, and that may lead to a “mini taper tantrum” next year, according to John Herrmann at MUFG Securities Americas.
The strategist sees the unemployment rate dropping far more quickly than most forecasters, including the Federal Reserve. That could lead to a shift in investor sentiment that will drive up bond yields, echoing in part the 2013 lurch higher that has since been labeled “the taper tantrum.”