Investors fretting over tepid economic growth and speculating over whether the Federal Reserve will eventually adopt negative interest rates are missing the mark. The biggest potential shock to the markets won’t be from a recession but from a hawkish Fed, according to a Bank of America Merrill Lynch analyst.
“In our view, the bond market TMUBMUSD10Y, -4.86% still has two major mispricings,” said Ethan Harris, the firm’s global economist, in a report.
