A brief monthly update on what's happening in the municipal bond market.
PIMCO’s annual ESG Summit – hosted virtually this year – aimed to help participants keep pace with the rapidly evolving landscape of environmental, social and governance issues within the world of investing, with a particular focus on the transition to net-zero emissions.
Expectations for COP26, the importance of issuer engagement, and growth in sustainability-linked bonds were among the many topics covered.
Natural herd immunity in predominantly young emerging markets populations looks set to offset slower vaccine rollouts, setting the stage for a resurgence in economic growth.
In late 2020, China launched an anti-trust campaign focused mainly on big technology firms, aiming to crack down on what the government views as monopolistic practices.
We believe the U.S. is undergoing a large price-level adjustment, not shifting to a persistently higher inflation regime.
Momentum in China’s property market remains strong so far in 2021, driven by healthy demand for housing.
As regulators push to transition away from Libor, sales of Treasuries linked to the successor rate could boost the new benchmark’s credibility and expand nascent markets for related debt and derivatives.
As expected, the Federal Open Market Committee (FOMC) announced no changes to its administered rates following its April meeting, and Federal Reserve Chair Jerome Powell did not provide new information about the Fed’s bond-buying programs.
Nuclear decommissioning trusts (NDTs), the pools of money accumulated over decades used to dismantle nuclear power plants and safely dispose of radioactive materials, allocate about 40% of their assets to fixed income securities.
Since the disruptions that roiled financial markets in March 2020, investors have turned more to cash and other short-term instruments typically associated with risk aversion and preservation of capital and liquidity.
On April 21 the Governing Council of the Bank of Canada (BoC) will meet to discuss monetary policy.
Computer chips, or semiconductors, power everything from cars to consumer electronics, such as PCs, gaming consoles and smartphones.
We forecast a strong global recovery in 2021 amid significant fiscal support, accommodative monetary policy, diminishing lockdowns, and accelerating vaccinations.
Democrats could begin working on a tax bill later this year, but resulting tax hikes may be weaker and less of a headwind to growth than some fear.
Stock market bulls can find reassurance in the equity risk premium, which suggests stocks are valued fairly or slightly expensive.
The Federal Reserve on 19 March announced that the temporary changes to its supplemental leverage ratio, or SLR, will expire as scheduled on 31 March.
Following its March meeting, the Federal Open Market Committee (FOMC) released a statement and summary of economic projections (SEP).
As the latest COVID-19 relief bill winds through the U.S. Congress, some economists have been warning that too much stimulus could lead to the economy overheating
Longer-dated Treasury yields have climbed as markets consider whether economic growth and inflation expectations might accelerate more rapidly. We believe inflation pressures will remain in check and bond yields will be range-bound.
China’s economy should see a soft landing as stimulus is reduced, but the drag on global growth may place a burden on developed economies to keep stimulus taps open for longer.
One year since the inception of one of the most severe recessions in modern history, women’s engagement in the labor force is crucial to the economic recovery.
As International Women’s Day approaches, three PIMCO executives share their perspectives on diversity in the workplace.
Target date funds should be designed to reduce the risk of rash selling.
A large fiscal package geared toward pandemic relief will likely boost U.S. growth even further in 2021, but long-term inflationary risks are still balanced.
Political change, continued fiscal support will drive municipal markets in 2021, although outcomes are likely to vary.
It’s tempting these days for some investors to question the role of fixed income in portfolios. After all, real yields have plunged, potentially leading to less income today and smaller capital gains tomorrow.
A clear communication strategy is crucial to managing market expectations around changes in Federal Reserve asset purchases and interest rate policy.
A holistic LDI portfolio may provide a superior liability hedge.
Despite seeing major market swings following the 2016 Brexit referendum, we don’t expect Britain’s departure from the European Union (EU) to have any major economic effects in our baseline outlook for 2021 and beyond. Far more important are COVID-19, fiscal policy, and bigger questions around future productivity growth.
A confluence of dynamics are set to accelerate global capital flows to emerging markets amid attractive valuations.
PIMCO’s “Income to Outcome” framework offers strategies to navigate retirement’s stumbling blocks.
Global output and demand are likely to rebound strongly in 2021, but we see risks that call for careful portfolio positioning.
With a narrowly Democratic Congress, U.S. fiscal spending is likely to increase on economic relief from the pandemic, infrastructure, and healthcare, boosting the economic rebound.
In this abridged version of our latest Asset Allocation Outlook, we discuss the opportunities and risks of investing in an early cycle recovery.
How can credit markets help active investors achieve their goals in the present low yield environment? Here are 5 ideas.
Is the 60/40 stock-bond portfolio dead? We don’t think so.
The Federal Reserve signals that monetary policy accommodation will remain firmly in place.
The U.S. stock market surged in November, erasing October’s losses even amid a rising number of coronavirus infections. Propelled by progress toward potential coronavirus vaccines and hopes for a relatively smooth transition to power for president-elect Joe Biden, major U.S. equity indices closed the month with double-digit gains.
We believe traditional fixed income should continue to provide a reliable source of diversification against a growth shock, but low rates and the risk of an inflation shock necessitate broadening the menu of diversifiers.
Some of the world’s leading countries have recently announced major sustainability targets. These moves, aimed at making economic recovery faster and more sustainable, will create investment opportunities as well.
Debt of many emerging market countries can offer robust yields and enhance portfolio diversification, provided the asset manager has the resources and sophistication to avoid potential pitfalls.
Wide performance dispersion underscores the importance of portfolio construction.
It will continue to be important to be an active investor during this period of transition and to carefully monitor the impact of policy on credit sectors.
Liquidity issues and other business risks could prompt a wave of defaults and restructurings, in turn creating fertile ground for opportunistic investing in distressed credit.
We are cautiously optimistic about economic growth over the next year, but over the longer term, disruptive factors will likely contribute to heightened volatility and lower returns across both fixed income and equity markets.
Amid an environment of near-zero benchmark and T-bill yields, for a modest increase in risk, PIMCO's short-term strategies may offer higher levels of total return and income for stepping beyond the confines of money market fund strategies.
In our view, inflation-fighting asset classes look considerably cheaper and offer higher long-term estimated returns than mainstream stocks and bonds.
