Multi Asset chart of the week | Insight Investment

This has been the worst ever start for bond yields in a Fed cutting cycle

Christopher Broadley, Portfolio Manager, Multi-Asset Strategy Team, said: “The consistent march higher in government bond yields since the Federal Reserve’s first cut back in September is very unusual when compared to previous cutting cycles. Indeed, the 114bp rise in 10-year yields at this stage compares to a median fall of 22bps and maximum historical rise of +42bps. The main drivers behind this rise in yields are sticky inflation, a robust labour market and concerns of the potential impact of tariffs. Within our portfolios we have maintained an underweight allocation to duration with the mindset that a shift in momentum could provide a more attractive entry point.†”