Markets have stabilised after Bernanke’s assurance to continue buying bonds

When US Federal Reserve chairman Ben Bernanke spoke of tapering the quantitative easing (QE) programme last month, markets had reacted negatively with investors moving back to US Treasuries on expectations of yields rising again.

However, several factors have reined in volatility - assurances that bond purchases under the QE programme will continue and indicators showing that the Chinese economy may be stabilising.