Inflation fears and lack of liquidity elevate bond yields to adequate levels

Yields of mid-term corporate bonds have become more attractive in view of our inflation and growth o...

Yields of mid-term corporate bonds have become more attractive in view of our inflation and growth outlook. We thus lengthen the recommended duration for fixed-income portfolios. We favour direct investments over synthetic exposure, prefer convertible bonds and consider inflation-linked investments to be increasingly attractive. Yields of corporate bonds have risen to an adequate level. Corporate bonds are of a good quality - with a benign default risk and offering 6% and more in US dollars or euros and 4% in CHF. Yields for mid-term AA-rated corporate bonds have risen to 1.5% since the b...