Central banks are planning to cut their exposure to longer-term debt to protect themselves from losses when the Federal Reserve ends its bond-buying this autumn, increasing the risk of instability in global markets.
The majority of respondents in a survey of reserve managers who control assets worth $6.7tn, or more than half of central banks’ total reserves, said they were likely to adjust their portfolios in preparation of tighter monetary policy.
As the UK and US embark down the path back to more normal interest rates, big changes in asset holdings by other central banks around the world would heighten the risks of market disruption.
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