Without a doubt, 2022 was a year to forget for the bond market. Government bonds, high end corporate credit or riskier high yield paper all had the same fate as steep increases in interest rates across the glove sent bond prices tumbling. Fast forward to the final few months of 2023 and the outlook is very different; bonds are once again back in vogue with the major central banks now appearing to be close to (or at) terminal rates. Despite an overall weakening in global economies, expectations for a soft-landing are still very strong. We have had a ‘soft-ish’ landing base case for quite a while now so, while we think that respective economies will flirt with the idea of a recession, we do not believe that we will fall into one in a big way. That said, we cannot be complacent and whilst the economic picture has been much more resilient than we expected last year, there remain pockets that we are still cautious on.
George Curtis provided a macro update on fixed income markets and an overview of positioning in the TwentyFour Select Monthly Income Fund.
The update was followed by a Q&A session.