Turmoil in the Middle East seems to have upended the traditional safe havens favoured by investors in times of global chaos.
Traditionally, investors turn to government bonds in times of turmoil, seeking diversification.
This time, however, bonds have tumbled alongside risk assets, according to market analysts.
The immediate issue is the surge in oil prices, which has driven up inflation expectations and, therefore, short-term bond yields. At the same time, weaker growth prospects and government spending on energy support have worsened fiscal outlooks, pushing longer-term yields higher as well.
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