Don't Bet on a Bond Rally

Bill Gross and other bond bulls are calling for a rebound, but it's not a sure thing. Why? An uncertain Fed outlook

Bonds are coming off a lackluster six months. One popular benchmark, the Lehman Brothers U.S. Aggregate Index, lost 0.7% in the first half of 2006, compared with a 2.5% gain for the same period a year earlier. Now some analysts say the tide may be turning, amid signs of a slowing economy and favorable price trends for Treasury issues.

To continue reading this article you must be a Bloomberg Professional Service Subscriber.