Fixed Income – Page 10
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Investors Cannot Ignore the Debt-Sustainability Question
Despite a pullback in bond yields, clients at our Solving for 2024 event were still uncertain about how to invest in a world of runaway government debt.
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Higher rates will start to bite the corporate sector in 2024
The impact of rate increases on businesses is expected to intensify in 2024. Businesses haven’t been impacted much by higher rates so far because they have used the cash they collected during Covid and refinance needs have been limited. However, refinancing needs will rise in 2024 Small and medium sized companies and lower rated HY issuers will be most impacted. The spillover from higher rates will be more limited for IG companies.
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Dovish Fed contemplates rate cuts: risks to weaker US growth persist
The Fed kept its benchmark overnight borrowing federal funds rate unchanged at 5.25-5.50% for the third consecutive meeting, that is, a period now spanning almost five months. The FOMC statement and press conference were more dovish than we – and the market – expected. This was exemplified in Chair Jerome Powell’s comment that the Fed believes interest rates are at or near their peak in this cycle.
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Powell pivots policy: moving closer to rate cuts
The U.S. Federal Reserve left interest rates unchanged at its December meeting, as expected, and updated projections signal even more rate cuts in 2024 than previously expected.
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Allview: Market Risk Monitor - December 2023
Each month, Allspring’s Investment Analytics team assembles a top 10 list of market risks that it believes have the potential to influence investment portfolios.
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Can You Protect the Environment and Your Yield?
Reducing carbon intensity doesn’t mean sacrificing yields. Issue selection in high-emitting sectors can help insurers stay on track with their liabilities.
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Assessing the U.S. Economy’s Evolving Sensitivity to Interest Rates
Our research series reveals that a varied adjustment process across certain sectors lowered the broader economy’s sensitivity to interest rates.
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The Balance Between Corporate Profit Margins and Economic Resilience
This blog shares our views on the relationship between corporate margins and different U.S. economic growth scenarios using our corporate profit model to estimate performance.
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Tracking the Transition from Tighter Policy to Corporate Spreads
We explore the historical transmission from tighter monetary policy to corporate bond spreads and the respective investment implications under our “weakflation” scenario.
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The overlooked appeal of short-dated euro corporate debt
Corporate balance sheets continue to provide support for opportunities in the front-end of the credit curve in the eurozone.
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Resilient private credit fills a growing need across U.S. and Europe
The U.S. and European private credit markets have been a significant success- story of asset management for the last decade. Having begun life as a source of financing for mid-market companies that could not raise funds elsewhere, private credit has grown into a serious and credible competitor to both traditional bank debt and the liquid markets (i.e., the leveraged loans and high yield bonds), something that would have seemed fanciful just a few years ago. Now, private credit players are regularly financing the entirety of multi-billion-dollar debt structures.
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Office Space: The CRE Effects On Major U.S. Cities
Rising office vacancy rates, declining property valuations, and the respective impact on tax revenues and city budgets are a source of growing concern for municipal bond investors.
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From NICE to VILE—The Future of Inflation
We explore the type of inflationary environment that we might expect across developed markets in the future and its potential effect on global asset prices.
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Debt sustainability in emerging markets
The Franklin Templeton Fixed Income team believes more sovereigns are turning to the IMF for financing support as capital markets for low-income countries remain shut. In this paper, they consider how the IMF Debt Sustainability Framework could play a crucial role.
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Cooling high-carbon sectors with corporate bonds
Investing in companies that are already low-carbon today does nothing to lower emissions in the future. That’s why we invest in transitioning companies with credible plans to decarbonise. How do we assess companies for their climate alignment to see if they make the cut for our TargetNetZero credit strategy?
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US bonds: Thinking beyond rates
In an economic environment characterized by rising interest rates and slowing growth, our investment professionals see fixed income as a beacon of opportunity.
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The Mortgage-Backed Moment
Securitized credit, and especially mortgage-backed securities, can be an attractive source of income while waiting for volatile bond markets to settle.
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Private Credit: European special situations outlook
The opportunity set in European special situations credit is gearing up to be as fertile and attractive as it has been since the global financial crisis for a number of reasons, according to BSP-Alcentra.
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Markets bounce on waning inflation
Markets reacted positively to stronger-than-expected US and UK inflation data this week.
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Moment of truth
A hard or soft landing could throw a harsh light on corporate fundamentals in 2024. In the second set of breakout sessions from our Fixed Income Forum in London on 14 November, attendees learned of the potential in unconstrained credit, the opportunity in investment grade and the crucial role fixed income can play in the sustainability transition.