Pensions Are Still Hungry for Long Bonds Even After Tax Deadline

Sept. 15 U.S. date to use old tax-deduction rates has passed
Long-term Treasury yields near 2018 highs also aid demand

Pedestrians walk near the U.S. Treasury building in Washington, D.C.Photographer: Andrew Harrer/Bloomberg

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By Liz Capo McCormick

September 20, 2018 at 10:00 PM UTC

Updated on

September 21, 2018 at 11:15 AM UTC

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This month’s deadline for companies to tap more-lucrative deductions from U.S. pension contributions using 2017 tax rates has passed. Yet most strategists expect pension demand for long-term debt to persist, especially with yields near the highest this year.

That’s the message from strategists at firms including Goldman Sachs Group Inc., JPMorgan Chase & Co. and TD Securities. While the passing of the Sept. 15 deadline has likely helped fuel this week’s runup in Treasury yields, Wall Street analysts still see plenty of reasons for pensions to keep adding Treasuries.