Fidelity: recession discounted by credit markets

The deteriorating economy has been largely discounted by the credit markets, with fixed income invest...

The deteriorating economy has been largely discounted by the credit markets, with fixed income investors not having to look far for attractive returns, according to Fidelity's Ian Spreadbury. Spreadbury, senior portfolio manager of the Sterling Bond fund, points out that the redemption yield on investment grade corporate bonds is currently 8.6% with a spread above government yields of 4.75%. From a long-term value perspective, he says this spread is the widest since the Great Depression while the yield on UK corporate bonds is well above both expected and the average long run nominal GDP gr...