Monthly bond wrap – Euro and US fixed income returns in November 2017

Post with image

Flattening of the yield curve was the principal theme in the US bond market in November with long duration Treasuries outperforming (see Exhibit 1 below).

As 2017 draws to a close, it looks (once again) as if the contrarian view of being overweight long maturity Treasuries was the right positioning in 2017.

Negative policy rates in the eurozone continued to fuel a search for yield that has led (bond market) investors to boost returns via corporate debt and long-dated fixed-income assets.

As in the US bond market, the euro sovereign yield curve flattened in November, resulting in relatively strong performance for sovereign debt with a maturity above 10 years.

Exhibit 1: Bond sector performance (total return; in %; latest month and 01/2017-11/2017)

 

Also read:

Written on 01/12/2017

Leave a reply

Your email adress will not be published. Required fields are marked*