Can this trio of 'yield dampeners' protect bonds from rate rise?

Investors predicting historically-low interest rates will rise after the end of quantitative easing are misguided, M&G's fixed income desk have said.

Following the ‘taper tantrum' of 2013, where yields on most government bonds jumped after the US Federal Reserve signalled it would look to end QE, many commentators now predict a move to curtail stimulus measures later this year could be the catalyst for a sell-off in fixed income assets. But a trio of "yield dampeners" could keep rates lower for longer, according to M&G investment director Anthony Doyle. The fragility of the global economic recovery and high debt levels in the US make it unlikely interest rates will return to pre-crisis levels, he said, limiting the potential downsi...