Central bank body BIS warns of hedge fund leverage in government bond markets

Core Insights - The new head of the Bank for International Settlements emphasizes the need for policymakers to focus on limiting hedge funds' capacity to engage in highly leveraged investments in government bond markets due to the rising levels of public debt [1] Group 1 - The increasing public debt levels are a significant concern for financial stability [1] - Hedge funds are currently able to make substantial leveraged bets, which poses risks to the government bond markets [1] - Policymakers are urged to prioritize regulations that would rein in these hedge fund activities [1]