Every month, portfolio manager Jeff Moore brings his unique perspectives on global fixed income markets, using a multi-sector lens. Reflation and reopening are the big topics right now, and Jeff’s view is that we will reopen gradually over the next few months. The market is in the right place for now, and has done a good job of pricing in reflation, fiscal stimulus, a blue wave in the U.S., etc. Investors should think about inflation being around 3%; by December, Jeff thinks it will be back around 1% – a “snapback and then a rollback.” Jeff’s biggest concern about coronavirus variants is that we have added a lot of debt as a result of a series of shutdowns and recoveries. For some countries, this debt will be a big issue. That said, it looks like the U.S. will snap out of it a little faster than the rest, due to massive stimulus – but while the U.S. will likely have the fastest recovery, it will also have the highest interest rates.
Recorded on March 17, 2021.