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Allianz Global Investors: US Bonds/ USD Drop Reflects Investors' Doubts about US Finances, USD Status as Reserve Currency
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The decline in US bonds and the USD, which have traditionally been viewed as a safe-haven, may reflect investors' concern that a slowdown or recession in the US economy will further worsen the US' already unsustainable fiscal outlook, as well as the market's skepticism about the USD's status as a global reserve currency, Michael Krautzberger, Global CIO Fixed Income at Allianz Global Investors, said. Allianz Global Investors expected the biggest concern to be the recent increase in the US tariff threats, especially on Chinese goods, which is prompting big foreign holders of US treasuries in tariff-hit countries to sell their US treasury holdings, turning a trade war into a capital war and representing a significant escalation in tensions at the moment. AAStocks Financial News |
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