SocGen's Edwards: 'Reflation trade is Trump-inspired fake news'

Remains positive on bonds

Société Générale's bearish analyst Albert Edwards has warned the direction of yields is more uncertain in the near term than the low level of bond volatility suggests and the reflation trade is just "fake news".

In his latest global strategy alternative view report, the analyst said the last time volatility in the US bond market was as low as it is now, 10-year yields spiked up as part of former Fed chair Ben Bernanke's 'Taper Tantrum'. While Edwards and his team remain long-term "Ice Age bond bulls" and forecast negative Fed funds and 10-year yields in the coming recession, he added near-term investors should be open-minded. He said: "We continue to expect US 10-year yields to converge with Japanese and German yields deep in negative territory in the next recession. "It was only last summ...