Latest / Monetary Policy Explained with Fexingo: Central Banks, Money Supply, and Interest Rates
How Central Banks Use the Term Premium to Gauge Market Sentiment
In this episode of Monetary Policy Explained with Fexingo, Lucas and Luna unpack the term premium—the extra yield investors demand for holding long-term bonds over rolling short-term ones. They explore why this obscure metric spiked in 2021, how it reflects market fears about fiscal sustainability and inflation, and why Fed Chair Powell watches it as a signal of regime change. The hosts use the 2021 taper tantrum as a concrete case, showing how a compressed term premium can suddenly decompress, scrambling central bank communication. They also discuss how the term premium influences mortgage…
The skinny
The skinny isn't ready yet — notes appear once the transcript is processed.