There are many buyers of government bonds ranging from those big central banks, pensions, insurance companies, regular banks and investors (like you and me). The proportions of these cohorts change over time for many reasons. Today, we believe the groups whose demand is more sensitive to different yields have a larger representation. This could limit how far yields may come down, even in a recession, as lower yields may see many buyers stop or slow buying. We believe the overall elasticity of yield demand has risen.

Click HERE to access the report.