Blue-Chip Corporate Debt Is the Market's Least-Loved U.S. Asset
- The bonds are on track for their worst first half since 2013
- Tailwinds for the debt in the second half, but timing’s hard
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Blue-chip corporate bonds are on track to be the worst-performing U.S. asset class this year, and money managers caution that it may be too soon to start looking for bargains.
The strong economy is triggering fears of rising inflation and unexpectedly fast Federal Reserve rate hikes, which have weighed on both U.S. Treasuries and investment-grade corporate bonds. On top of that, American companies are borrowing more and their interest costs are rising relative to their income.