(chart "geeks": this blog's for you!!)
Euro zone deflation abruptly changed course:
10 year German Bond Yields responded with a significant move higher (prices fall).
From near 0% on April 20th to .37% yesterday, as bond investors now want an "inflation premium" to protect them.
Sentiment is changing and not just in Europe:
Bond yield curves are shifting in North America too.
It is too early to tell if this is a correction of markets that had got ahead of themselves or if it is marking a change in trend, but it is bond markets that lead all financial markets and it is important to keep a close watch on developments on this front.
Scott Tomenson,CIM Managing Partner, Chief Investment Strategist