Borrowers are being warned that the days of insatiable demand for their short-dated corporate bonds are numbered, now that Fed Chair Janet Yellen has in effect given next April as a date when the Fed could start hiking rates. Treasury yields gapped out by as much as 16bp at the short end on Wednesday, after Yellen said six months was about the time after tapering ends that the Fed might start to hike the Federal Funds rate. If the Fed continues the current pace of tapering its bond purchases, then September/October could be the time when it has exited its stimulus programme altogether. Six months from October is April next year.
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