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The impact of pensions and insurance on global yield curves

Robin Greenwood, Annette Vissing-Jorgensen  |  July 11, 2018

“… Using data from 26 countries, the yield spread between 30-year and 10-year government bond yields is negatively related to the ratio of pension assets (in funded and private pension and life insurance arrangements) to GDP, suggesting that preferred-habitat demand by the P&I sector for long-dated assets drives the long end of the yield curve. … We describe settings in which pension discount rules can have a destabilizing impact on bond markets.”

Read the full article on: Harvard Business School

 
 
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