Bond Traders Risk Being Wrongfooted by 2022 Playbook, UBS Warns

Traders risk being wrongfooted by bets that major central banks will move in unison to respond to the threat of prolonged war in Iran, according to Bhanu Baweja, chief strategist at UBS Group AG.

“The markets are pricing this like it was 2022 where you price up all central banks together — it’s a very different situation,” Baweja said in an interview with Bloomberg TV. A more “asymmetric” scenario is more likely, where the European Central Bank, the Federal Reserve and Bank of England respond in different ways, Baweja said.