All insights
Government Debt Has Exploded. Does It Matter?
Given most countries are going through the same issues and their fiscal expansions are justified, the relative value has not changed that much.
The US Bond Market Recovery has also Outpaced Equities…with a Twist
Yesterday we showed that for European investors, what we speculated on back in March has come true; that the bond market did recover its losses far more quickly than equities, as shown below.
Ratings Migration Pointing to Lower Defaults
A trend of negative ratings migration has historically been a consistent precursor for a pick up in the default rate of publicly rated debt.
The Bond Market Recovery has Outpaced Equities
The clear opportunity within IG credit from our perspective, without having to take excessive risk, is to buy legacy Bank and Insurance IG debt.
Starved of Income
With BP slashing its dividend this week, we have now seen 52 of the FTSE 100 companies suspend or cut their dividends this year.
Optimism from the FPC
As expected the Monetary Policy Committee (MPC) kept UK base rates at 0.1% and maintained their current level STG IG corporate bond on the BoE balance sheet at £745bn, with no immediate expectations of a need for further stimulus.