Shaw Capital Management February Newsletter: Government bond Markets 3 of 3

Shaw Capital Management February Newsletter: Government bond Markets 3 of 3 Shaw Capital Management Korea February Newsletter: Article three of three - The markets are assuming that the more powerful members of the eurozone will support the weaker members... More

Shaw Capital Management February Newsletter: Government bond Markets 3 of 3 Shaw Capital Management Korea February Newsletter: Article three of three - The markets are assuming that the more powerful members of the eurozone will support the weaker members in order to prevent defaults that might threaten the single currency structure; but the yield spreads have widened considerably to reflect the increased risks. Our tentative view is that the markets will “muddle through”, and that defaults will be avoided; but higher overall yield levels seem unavoidable. Prospects in these markets are therefore very unattractive. The gilt edged market has also come under pressure over the past month; short-term yields have remained basically unchanged, but there have been increases in medium and longer-term yields that has produced a much steeper yield curve. Shaw Capital Management Korea February Newsletter: Article three of three - There has been evidence of a modest improvement in the economic Less