December 2020 – Bond Market Review
The economy has improved significantly from the early stage of the pandemic, but GDP remains well below its pre-pandemic peak and unemployment remains elevated. In the near-term, we believe downside risks to the economy remain due to a resurgence of the virus and the ongoing stalemate in Congress over additional fiscal relief. Economic data is […]
November 2020 – Bond Market Review
While near-term headwinds from the pandemic and lack of additional fiscal relief continue to present downside risks to the recovery, we are increasingly optimistic about the economic outlook for next year. We continue to believe the trajectory of economic growth hinges on the course of the pandemic, the timing and amount of additional fiscal relief, […]
October 2020 – Bond Market Review
US equities experienced a moderate selloff in September (with the S&P 500 index down 3.9% month-over-month) and investment grade corporate credit spreads widened modestly (based on the ICE BofA US Corporate Index). In our view, the recent repricing of risk assets has been rational and consistent with the evolving economic and political backdrop. The economy […]
September 2020 – Bond Market Review
The US economy continues to experience a somewhat uneven and slowing pace of recovery, consistent with more of a U-shaped (rather than V-shaped) recovery, in our view. However, the outlook for the economy remains uncertain. We believe the outlook is largely dependent on the course of the pandemic, the amount of additional fiscal relief from […]
August 2020 – Bond Market Review
The second quarter was likely the low point for economic activity and the consensus forecast calls for a fairly strong rebound in activity in the current quarter and a slowing pace in improvement thereafter. However, the outlook remains uncertain, particularly amid ongoing US COVID-19 outbreaks. We believe the outlook for economic activity is largely dependent […]
July 2020 – Bond Market Review
We believe the economy contracted sharply in the second quarter, but market participants are expecting a meaningful rebound in the current quarter. Although we anticipate that the recovery will be somewhat bumpy, we believe the weakest economic data is in the rearview mirror. Robust fiscal and monetary relief should continue to fuel improvement in economic […]
June 2020 – Bond Market Review
The National Bureau of Economic Research has officially determined that the US economy entered a recession in February 2020, following a 128-month economic expansion. First quarter GDP declined 5.0% and the decline in second quarter GDP is expected to be more severe. More than 42.6 million people have filed for unemployment since mid-March, though many […]
May 2020 – Bond Market Review
Financial market turbulence eased in April and the S&P 500 index increased 12.7% in the month, even as economic data weakened. Supported by a historic fiscal and monetary response, we believe equity market participants are generally looking through the weak economic data and expect conditions to improve in the second half of the year. First […]
April 2020 – Bond Market Review
Financial markets were extremely turbulent in March, driven by a high level of uncertainty and fear regarding the impact of the COVID-19 pandemic on the global economy. The S&P 500 index declined 20.0% in the first quarter and the average option adjusted spread on investment grade corporate bonds (based on the ICE BofA US Corporate […]
March 2020 – Bond Market Review
Financial markets experienced significant turbulence during the month of February, driven by a high level of uncertainty about the impact of coronavirus on global economic growth. We believe this was further exacerbated by rising US political uncertainty ahead of this year’s presidential election. The US Treasury market was particularly volatile during the month, amid a […]