Dutch Pension Shift Obsessing Bond Traders Is About to Get Real
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Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the worldAmericas+1 212 318 2000EMEA+44 20 7330 7500Asia Pacific+65 6212 1000Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the worldAmericas+1 212 318 2000EMEA+44 20 7330 7500Asia Pacific+65 6212 1000One of the biggest owners of European government bonds could trigger a bout of volatility — just as many market participants are away from their desks.The Binnenhof government complex in The Hague. An aging population and declining birth rates means its getting harder for the Netherlands to cover retirement costs. In the European market for long-term bonds, a once-loyal and deep pocketed customer is about to start shopping elsewhere. The €1.6 trillion ($1.9 trillion) Dutch pension system — the largest in the region — is undergoing a major transformation aimed at making it more sustainable for an aging population. Funds will invest more in riskier assets and less in bonds, with a big drop in demand expected for long-term interest-rate hedges.