The government bond market should brace for the worst crisis since 1949, analysts at Bloomberg warn. Government bonds across the world are rapidly losing their value and heading for the worst performance in many decades. As global central banks are aggressively lifting interest rates to combat stubbornly high inflation, the bond market is suffering huge losses. “Government bond markets are on course for the worst year since 1949, when Europe was rebuilding from the ruins of World War Two,” strategists at Bank of America say. The US Federal Reserve was the first to embark on the path of monetary tightening. After that, other central banks followed suit and launched the tightening cycle. So, regulators worldwide stopped keeping their interest rates near zero as they did during the Covid-19 crisis to support the economy. This turn in monetary policy has had a big impact on government bonds. The recent decision of the American regulator to raise its benchmark interest rate was the last serious blow to the global economy.