As the calendar turns towards 2026, the fixed income landscape is drawing significant attention from investors, largely due to persistently elevated long-end yields and the anticipation of further monetary policy adjustments by the Federal Reserve. This confluence of factors is setting the stage for a compelling environment for bond investments,
The Fed is expected to reduce interest rates at the FOMC meeting, with a 25 or 50 basis point cut. Investors are betting on a 50 basis point cut and are reshuffling their portfolios, favoring value-oriented ETFs and gold.
When interest rates fall, bond prices rise. And while it has been some time since we’ve been able to say interest rates are dropping, the past few months have done just that.
The complexities of forecasting in 2023 include: The market is betting on Fed rate cuts and a soft landing; is that a reasonable assumption? What will break the logjam?
