Q1 2018 Fixed-Income Outlook | Guggenheim Partners

February 21, 2018

Adam Bloch and Brian Smedley share insights from the First Quarter Fixed-Income Outlook

Fixed-Income Outlook

First Quarter 2018

Report Summary

Fixed-income markets have been walking a risk tightrope for several quarters. Bonds in most sectors are trading above par, yields are historically low, and spreads are near or below pre-crisis levels. The best that a bond investor can reasonably hope for in this market is to earn the coupon, while principal is at risk from an active Federal Reserve, the looming increase in Treasury supply, geopolitical risk, and any credit deterioration. Current conditions could persist for some time—economic growth is accelerating, monetary policy is not overly restrictive, and optimism is high—but history has shown that with a recession approximately two years away, the time for caution is approaching.

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Fixed-Income Outlook: A Tight Market Gets Tighter

Positioned for Choppier Waters

FEATURED PERSPECTIVES