We have relatively cautious expectations for this week’s U.S./China trade negotiations. A potential truce or de-escalation in the trade war is a “good news” card for President Trump, and he could wait for additional political developments over the next six
As demand for duration sends US Treasury yields down towards 1.50%, we look at the factors that could potentially push rates through this key psychological level.
What a scarcity of reserves means for US monetary policy Tensions in short-term funding markets in September suggest a fundamental scarcity of reserves. Federal Reserve (Fed) Chair Jerome Powell said the Fed would resume a balance sheet expansion soon –
I f there is one thing that whips up Wall Street, it is any sort of bottleneck in ordinarily placid short-term money markets. So in September, when getting overnight loans in exchange for US Treasuries suddenly became expensive—much sooner in
Looking at the issuance performance so far this year, CEE countries have done a very good job. Several countries have already covered this year’s issuance plan and many others have also reached a high number. Slovakia seems to be lagging
Broad market volatility spilled into the loan market this week, as the S&P/LSTA Leveraged Loan Index (the “Index”) lost -0.41% for the five business days ended Oct. 10, led lower by a 51 basis points reduction in the Index bid
China’s onshore credit market has witnessed tremendous growth over the last decade as it transforms towards a more marketoriented system. We take a detailed look at this maturing market and outline how a recent rise in defaults should be viewed
Central banks provided the motive force that drove the good returns in developed market equities and bonds since the Great Financial Crisis. Policies that were intended to push against the risks of deflation brought us record low bond yields, negative
In the current low yield environment, Danish mortgage bonds are a very attractive alternative for EUR, USD and JPY fixed income investors, given that Danish mortgage bonds offer a relatively high expected return and a very low credit risk. Denmark
Emerging market bonds are now a strategic holding for many investors. But the desired result from an allocation to emerging market debt cannot be achieved without first considering the attributes of hard and local currency-denominated bonds — the two broad
2018 was a bear market, but in the last six months credit has traded in a range – a remarkable performance given the slowdown in economic growth. Since last quarter, rates markets have been much more volatile than credit. Ominously,
Money market trends as observed through MMSR data* In 2018, thanks to the granular data gathered via money market statistical reporting (MMSR), the Eurosystem was able to undertake for the first time a complete and thorough assessment of developments in
Bonds continue to be sought after, despite ever longer maturities sporting negative yields. In addition to economic uncertainties caused by the trade war and Brexit, liquidity shortages in US repo markets requiring supportive interventions by the Fed have recently unnerved
Should fixed income investors hedge currency exposure in their portfolios? That is the question – and the simple answer is “yes.” Yet, for investors looking to take currency exposure to generate additional return or to avoid hedging costs, we have
Credit spreads tightened in September after widening in August, although most asset classes remain around fair value. The dovish stance of central banks globally continued amid concerns about growth, Brexit, and risks of trade war escalation between the US and
Strictly speaking, all investing can be risky business, but income investing has been in the spotlight in recent months as investors move further down the capital structure in order to earn yields in today’s lower-yielding world. Eugene Philalithis looks at
Core government bond yields were lower last week and are back to close to the recent lows. They were pushed along this path by lower manufacturing sentiment indices. Specifically, the release of PMI data in the US reinforced the idea
Characteristics, historical performance and differences between the current credit cycle and earlier regimes A Fallen Angel (FA) is a corporate, or sovereign, bond downgraded from Investment Grade (IG) (minimum rating of BBB- with S&P, Moody’s or Fitch) to a High
As one central bank after the other announces cuts to interest rates, we continue to believe that buying duration will be worthwhile for investors, even with yields close to record lows.
Government bonds enjoyed another strong week with yields lower in the key areas. The release of PMI data in Europe offered little in the way of good news. It showed that the manufacturing downturn has taken another leg lower, driven
The strong performance from credit markets this year receives limited attention. However, the reality is that default risk remains very low and credit risk premiums generally compensate investors for taking risk. This makes certain strategies in fixed income look attractive.
Seeing Beyond the Complexity: Collateralized loan obligations are robust, opportunity-rich debt instruments that offer the potential for aboveaverage returns versus other fixed income strategies. Here, we explore how these instruments work, as well as the benefits and risks investors should
Yields are likely to remain low but not fall further. We believe a severe economic downturn would be needed to push them lower still. Yields are likely to remain low for longer. Central banks have guided the way. Accordingly, we
Central banks provided the motive force that drove the good returns in developed market equities and bonds since the Great Financial Crisis. Policies that were intended to push against the risks of deflation brought us record low bond yields, negative
Core fixed income has typically served the role of dampening equity beta while providing a moderate level of income in a portfolio. Income generation, traditionally from bonds, has been essential to well-diversified portfolios—as a source of liquidity and to stabilize
The integration of #ESG criteria often has a greater impact for emerging countries. Find out why in an interview with our expert #Karine_Jesiolowski (via @allnews_ch).
Fresh #StarkieBlog! https://t.co/YZrzQpIlIQ
Low interest rates drive housing market -> https://t.co/XjhuRim2P7 #Interest #mortgages via @ABNAMROeconomen
