Is the bond bull market over?

Is the 30-year bull market for government bonds nearing its end? We believe so. The short-term is impossible to predict but prospective real returns (i.e. adjusted for inflation) from US government bonds are likely to be negative over the coming five to ten years. We expect poor returns in the UK, Germany and Japan also. Although the US 10-year treasury yield is up more than 40 basis points since July, it remains extremely low by historic standards (1.8%) and relative to consensus expectations for inflation. The yield on inflation-protected 10-year government bonds in the US, UK and G...