Global bond yields to rise in 2017: BlackRock

BlackRock, the world's largest money manager, expects global bond yields to rise in 2017 as improving economic growth worldwide spurs reflation.Increase in consumer prices have picked up pace globally, and US president-elect Donald Trump's plans to boost infrastructure spending are fuelling speculation more ad vances are in store. China's factory-gate infla tion jumped to the highest since late 2011 at 3.3% in November.

The global economy will likely to expand 3.2% in 2017, up from 2.9% this year. Investors have be come “far more con structive on the global macro economy,“ which is good for equities but negative for bond prices, according to Belinda Boa, head of active investments for Asia-Pacific for BlackRock. “We believe that the global economy is at a very big inflection point right now,“ she said.Boa said the “reflation story“ is one of the most important themes for 2017 and will require investors to “re-think“ portfolio positioning. Within fixed income, BlackRock sees Asia as a bright spot as credit profiles are improving and default rates remain low.