Download the 4.4.25 Dynamic Bond Market Update for advisors’ use with clients By Bill Smith, Fixed Income Trader and Portfolio Manager Fixed income performed well in Q1 2025, amid a volatile environment punctuated by an escalating trade war and uncertainty surrounding the Department of Government Efficiency’s (DOGE) efforts to reduce federal spending. For the first
The Federal Reserve (Fed) has lowered interest rates by 75 basis points since initiating its easing campaign, reducing the federal funds rate to 4.50 - 4.75% from a multi-decade high of 5.25 - 5.50% in September. During this period, inflation has ticked up slightly, and the [...]
It has been six weeks since the Federal Reserve (Fed) commenced its easing campaign with a 50-basis point (bps) “jumbo” cut to interest rates. Next week, an additional 25 bps cut is widely anticipated at the November 6-7 Federal Open Market Committee meeting. While shorter bonds have largely performed as expected in this environment, longer maturities across major fixed income indices have seen yields spike higher [...]
As we enter a new Federal Reserve rate cut cycle, historical trends reveal that fixed income tends to perform well over the duration of the rate cycle, with the exception of short-term securities and cash. The timing of fixed income investing in a rate cycle is less important than the allocation itself [...]
If bond investors felt a bit whipsawed this month, that's not a surprise as bond yield volatility increased, especially at the beginning of the month. At the same time, correlations between stocks and bonds are decreasing, a welcome sign for investors in search of diversification. As the Fed signals an intention to cut rates in September, investors and their advisors can benefit from [...]
Evidence continues to accumulate that interest rate cuts are on the horizon as the Fed is likely to debate the timing and number of cuts in 2024. This potentially creates an attractive environment for U.S. fixed income heading into the Fall [..]
