Reported about 1 year ago
As of June 10, 2024, the U.S. April PCE growth rate has eased back, with markets expecting the earliest rate cut in September. Despite the delayed rate cuts in the U.S. bond market, tech bonds are outperforming other bond indices. The Fed is expected to lower the interest rates further, leaving room for rate cuts this year, making non-investment grade bonds attractive. Market analysts advise considering high-yield bonds with strong company fundamentals as the outlook for default rates remains low. The U.S. economy supporting non-investment grade bonds with relatively low default rates and better risk-adjusted returns compared to the stock market. European credit bonds are becoming more attractive, while U.S. credit bonds are losing some appeal due to narrowing spreads.
Source: YAHOO