Consequently, we saw a beginning of a shift from bonds to equities last week. In spite of their rich valuations in the U.S., equity prices jumped whereas bond valuations worldwide lost close to 1 trillion euros.
The Monetary Committee’s announcement of its assessment that monetary policy would remain accommodative for a considerable time, which means that the Committee’s assessment is that it would not raise the interest rate immediately after the interest rate increase in the US, which is what actually happened when the interest rate in the US was raised in December, also serves as a counterforce to the forces for appreciation.