Covid-19 and the ‘safe asset trap’, Virtual panel with Gita Gopinath
Commentary: Covid-19 and the ‘safe asset trap’
By Edoardo Reviglio in Rome
In recent decades the supply of safe assets has not kept pace with global demand. After the 2008 financial crisis, bond yields in many economies approached zero. A gap in the supply of safe assets was created, resulting in a ‘safe asset trap’. Covid-19 may help capital markets overcome this phenomenon.
Rising national public debts, as well as new...