The Bank of Japan is finally admitting the large costs associated with its current policy framework.
Consistent demand has helped limit volatility in high yield munis; fundamentals remain supportive, but pay attention to technicals.
The Fed opts to stay silent on September but options have a price – which the Fed has yet to pay.
Even after this year’s rally, we believe investors can still seek potential yields of 3%–6% in the U.S. credit markets.
It’s no secret that human beings are living longer and should better prepare for retirement than their parents or grandparents did. But the scope of this change may surprise some.
The influence of international capital on U.S. yields may be set to wane as rising hedging costs make U.S. Treasury bonds less attractive for foreign investors.
The Wu-Xia shadow fed funds rate troughed during the first half of 2014 at around -3% and has been rising ever since as the Fed ended QE and started to prepare the market for liftoff.
Strong retail sales data provide evidence that consumer spending remains strong enough to sustain the U.S. economic expansion in the short run.
Our expectation is that growth will fall to around 0% or slightly above over the next 12 months.
Dan Ivascyn, Group CIO, and Andrew Balls, CIO Global Fixed Income, discuss the investment implications of PIMCO’s secular outlook for an insecure stability.