Fixed Income Masterclass Highlight: The Post Fed Rate High Cycle
Kevin Flanagan comments on why the new rate regime is one of the most important factors facing bond investors. Watch this highlight from the Fixed Income Masterclass, in partnership with Asset TV.
Click here to access the full on-demand replay, available for CE Credit through Asset TV.
Kevin Flanagan:
Well, it remains front and center, right? To me, the new rate regime is perhaps one of the more important aspects that we've learned. Let's call it post Fed rate high cycle. I think we're done raising rates at this stage of the game. That seems to be changing on a regular basis, kind of tongue in cheek there, but we're looking at interest rates now in the US bond market that we haven't seen 10, 15, 16, 17 years. So it is kind of a new old rate regime that rates have gotten back to what we would argue to be more normal levels, [00:01:30] but this uncertainty surrounding Fed policy has created heightened volatility. Now, it had kind of slowed down a bit, but now with us trying to figure out from the beginning of the year six rate cuts, Fed said three, now the market's expecting maybe just two, it has once again created an elevated volatility stance in the bond market and, obviously, inflation is the underpinning for it all.
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