Across all major currencies there has been a sharp increase in interest rates in 2022. This has mostly been caused by inflationary pressures leading to central banks raising rates as their main weapon to control price increases and the associated risks of economic recession.

The USA is the world’s biggest economy and stock market and it too has seen changes typical of the current global situation. In the US inflation (as measured by the consumer price index or CPI) has jumped from 6.8% to 8.5% in the first eight months of the year. This has caused the five-year zero coupon interest rate to rise from 1.36% to 3.45% as a result of Federal Reserve action and sentiment. This five-year rate is the best point on the yield curve to see the likely effect on pricing of

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