Investors could face another decade of income scarcity
The coronavirus pandemic has brought about perhaps the greatest– and fastest – repricing of risk fixed income investors have ever witnessed.
Insights Topic
Monetary Policy
The Beginning of The End For Government Bonds
The list of policy actions from the major central banks keeps getting longer, and today the Bank of Japan has added the purchase of “as many Japanese government bonds (JGBs) as necessary” so as to keep the 10-year rate at around zero percent.
The Fed Has Raised The Bar (Again) With HY Support
When the Fed announced last month that it would be buying investment grade corporate bonds, it was said to have thrown the kitchen sink at the coronavirus problem. After this latest move, there are holes where the kitchen cabinets used to be.
Primary Bond Markets Escape Lockdown
It has been a positive sign for us that despite lockdowns being enforced in most of the major economies around the world, in the last two weeks several issuers have managed to successfully raise new debt via the primary market.
Primary Pause Positive for Prices in ABS
After a period of material weakness in spreads and general market stress, the common ingredient to recent corporate bond spread stability and subsequent strength has been the resurgence of the primary market.
Bond Basics Add Comfort Amid Virus Uncertainty
In response to the exceptional circumstances brought about by Covid-19, the Prudential Regulation Authority (PRA) at the Bank of England has written to UK banks asking them to ‘consider’ appropriate action regarding the payment, accrual and vesting of variable remuneration (i.e. bonuses) for senior staff, together with any dividend payments or share buyback plans.
CCDS Should Escape Payout Suspensions
With central banks and governments pumping huge amounts of funding into their domestic economies, they are obviously very keen that companies act with prudence and look after their surplus cash sparingly, by cutting back on distributions such as dividend payments and any share buyback plans.
TwentyFour Multi-Sector Bond Investor Update Webinar
Partner and Portfolio Manager Eoin Walsh provides an update on recent market developments and looking at the portfolio positioning of the Strategic Income Fund.
Bank Of England Announces “Big, Big Package”
Our take on all of this is that the central bank has acted in a very targeted and timely way, adding large volumes of liquidity at even lower rates, along with significant capital to the banking system.
What Next For Bonds After 'Capitulation Day'
Monday was one of those days investment professionals will remember all their lives, and compare with similar standout days from the past.
Will central banks ease the coronavirus pain
The big question for us now is how long the impact of the virus may last, and how much of a supply and demand shock will there be as a consequence of the various efforts to stall its spread.
Could Fiscal Stimulus Inflate Expectations?
Given where asset prices are at the moment, we would categorise inflation as a low probability, but high impact, risk.