Loomis Sayles Buys 30-Year Treasuries on Fed Liquidity Provision

Loomis Sayles & Co. is buying 30-year Treasury bonds on a bet that the Federal Reserve will continue printing money, according to money manager, Matt Eagan.

The Fed’s bond-buying plan “will be around longer than the market thought,” Eagan, who is co-portfolio manager of the Loomis Sayles Strategic Alpha Fund and Strategic Income Fund, told reporters in London today. “The economy is not strong enough despite the recovery. The market is getting ahead of itself. Even if the Fed starts to taper, they will still be injecting liquidity into the market.”

The firm is increasing its duration risk, Eagan said. Duration is a measure of a bond’s sensitivity to changes in interest rates.