1 July 2025 | Euro

European bond market to benefit from uncertain US trade policy — BlackRock

European bond market to benefit from uncertain US trade policy — BlackRock

According to BlackRock analysts, European bonds stand to benefit from a potential outflow of investments from American securities. This shift is driven by uncertainty surrounding the administration's trade policy and the growing US government debt.

BlackRock's report indicates that traders view the stability of Eurozone markets as more attractive compared to Asian counterparts. Analysts believe increased debt issuance by EU governments will boost liquidity in the region's bond market.

Nevertheless, the data does not yet show significant capital outflows from the US. In April, overseas investors bought the largest amount of American corporate bonds in the past six months. Citigroup strategists point to the diversity of the US market, where the amount of outstanding securities more than doubles that of euro-denominated bonds.

However, since April, German debt securities have been outperforming their American counterparts due to the inconsistent trade policies of US President Donald Trump, BlackRock notes.

Anton Volkov MarketCheese
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