U.S. Curve Will Steepen Whoever Wins Election, Schroders Says
- Schroders shorting U.S. 30-year bonds; likes Australian debt
- Favors Australian credit including airports, even some REITs
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The Australian arm of the more than 200-year-old investment firm Schroders is joining a growing number of peers betting on the U.S. yield curve to steepen.
A combination of the Federal Reserve keeping interest rates at record lows for longer and the inevitability of massive fiscal stimulus regardless of the result of the U.S. presidential election, will help yields on longer-dated Treasuries rise more than their short-term counterparts, according to Stuart Dear, deputy head of fixed income at Schroder Investment Management Australia Ltd.