Financial market developments

Quarterly Bulletin 1994 Q2
Published on 01 June 1994
  • US government bond prices fell sharply during the first quarter of 1994, as the market reacted to the Federal Reserve’s monetary tightening. Despite countries being at different points in the economic cycle, European bond prices responded by also moving lower.
  • As a result of falling bond prices and adverse market conditions, few straight bonds were issued after January. Many borrowers chose instead to issue floating-rate notes, which met demand from investors wishing to take a defensive market view.
  • In the highly volatile market conditions, turnover on derivative exchanges rose to record levels.

PDFFinancial market developments

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