Traders work at their desks in front of the German share price index, DAX board, at the stock exchange in Frankfurt December 17, 2015. — Reuters picLONDON, Feb 26 — European stock markets pulled back today after sharp losses in Asia overnight due to concerns over the prospect of high inflation and interest-rate rises that could hamper economic recovery from the coronavirus pandemic.
There is a worry that surging inflation could threaten one of the key pillars of the rally on world markets from their March nadir — record-low borrowing costs. “Yields have been rising for some time but have clearly accelerated recently and investors are nervous about the prospect of higher inflation and less central bank support,” Craig Erlam, market analyst at Oanda trading group, told AFP.Soaring US bond yields sparked a hefty overnight sell-off on Wall Street—led by the tech-heavy Nasdaq’s 3.5 per cent plunge.