Insight - A new era of short bets against German bonds is beginning

Toronto-Dominion Bank was forced to close its recommendation for investors to buy German bonds last week, after yields climbed above their stop-loss level. NatWest Markets are calling for investors to sell bunds, hailing the end of the “supercycle” that has seen the securities rally for the best part of two decades. (File pic shows a financial trader monitoring data on computer screens as a desktop television shows euro currency banknotes at the Frankfurt Stock Exchange. File pic)

THERE’S an unwritten rule in global bond markets: never short Germany.

But when Europe’s safest asset is in the midst of a retreat that threatens to push yields on bunds above 0% for the first time in more than two years, a paradigm shift may be underway.