Inflation increase would assist lower-grade paper

An increase in inflation would be beneficial for lower-grade debt despite the fact rising prices are...

An increase in inflation would be beneficial for lower-grade debt despite the fact rising prices are seen as a threat to the asset class. Adam Cordery, fixed income manager at Schroders, says the uncertainty inflation breeds will lead to a number of opportunities for bonds because of the effect it will have on their pricing power against others. Eddie Middleton, fixed income manager at Britannic Asset Management, says: "While inflation represents a big threat to bond markets because of the higher yields and lower prices it causes, within the market, certain sectors perform differently." ...