Bond Market Expert: Deleveraging Isn’t a Systemic Threat, but Watch Out for China’s Currency Moves

Recent comments on the state of the bond market were made by renowned analyst Steve Bessent, who drew attention to the current situation in this financial segment. Bessent noted that the process of deleveraging in the bond market is not a systemic threat, despite the volatility seen lately. However, he warned about potential consequences associated with recent changes in China’s currency policy.

The analyst emphasized that while the current dynamics in the bond market may cause certain concerns, it will not lead to catastrophic outcomes for the overall economic system. According to Bessent, deleveraging – the process of reducing debt obligations – is common in financial markets and is mainly driven by factors specific to current conditions.

At the same time, Bessent expressed concern over China’s maneuvers with its currency and the possible indirect consequences for the global economy. The expert pointed out that changes in Chinese financial policy may reveal new risks for other countries, highlighting the need for closer monitoring of these processes.

Thus, although the bond market is going through a period of debt reduction, Bessent urges not to panic. Instead, he recommends keeping a closer eye on changes in the international currency arena, as they may impact economic stability on a global scale.

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