CNBC reports that according to Quilter Investors Portfolio Manager Sascha Chorley, investor concerns about a rise in inflation are misplaced and bond markets are at their most attractive since 2015.
Inflation worries have led to a sharp rise in bond yields over recent weeks — most notably on the benchmark U.S. 10-year Treasury — and an accompanying fall in bond prices (as prices move inversely to yields).
But Chorley voiced skepticism that a steep incline in inflation is on the way. “If you look at market based expectations for inflation, it is true that indications are above the 2% target many central banks set,” he said. “But crucially it has been a steady increase since 2020 rather than a sharp rise.”
He said that, given current bond yields and the shape of yield curves, “this looks like the best time to add into government bonds since 2015. Starting to add some fixed income exposure might be quite prudent in order to add some ballast to portfolios.”
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