High yield market offering best value

Fund manager's comment

The tightening of monetary policy that commenced in the US this year might have been expected to ca...

The tightening of monetary policy that commenced in the US this year might have been expected to cause some sustained softening in US government bond prices as yields climbed. However, a high oil price and fears of an extended soft patch in the economy have driven some investors into believing that the US Federal Reserve may be less hawkish. We believe that this complacency is misplaced and that interest rates in the US are going to rise faster than people expect. Central to this belief is the fact that monetary policy is still accommodative, as evidenced by the large US trade deficit ...