Western countries are on the brink of their worst crisis in 73 years because of a sharp drop in demand for their government bonds, Bloomberg reported. According to Bank Of America, the collapse of the latter is approaching the levels of 1949 - the period of difficult recovery in Europe after World War II.
Bloomberg sees the reason in the aggressive raising of interest rates by central banks. However, according to Vasily Koltashov, head of the Center for Political Economy Research at the Institute for a New Society, low demand, particularly for treasuries, is not a consequence of the rates increase, but one of the reasons that prompted the U.S. authorities to agree to aggressive raising them.
Falling interest in government bonds of Western countries is associated with a loss of prestige and a change in attitudes towards them on the part of trading partners. In this connection one can recall the active sale of US treasuries by China, whose investments in the latter fell to a 12-year low in July. Such a trend is observed not only in China - other countries also get rid of U.S. debt securities, RIA Novosti wrote earlier.