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How are bonds holding up as inflation seems to settle?

  • Describe some of the challenges created by the bond markets and inflation
  • Explain what factors are affecting inflation right now
  • Identify the role of the unions in the US
CPD
Approx.30min

Today, with US and UK cash yields above 5 per cent and government bonds around 4.5 per cent, there are compelling alternatives, particularly if you believe that today’s inflation targeting will ultimately bear fruit.

I hope we have shown above that this is probable and that, despite the challenges we face, bond yields are starting to look attractive for longer-term investors.

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Guy Monson is chief market strategist and senior partner at Sarasin & Partners

CPD
Approx.30min

Please answer the six multiple choice questions below in order to bank your CPD. Multiple attempts are available until all questions are correctly answered.

  1. The UK gilts market has proven to be relatively resilient in the past few months, true or false?

  2. What do bond traders say about the travel of interest rates?

  3. According to the author, where is the direction of travel for interest rates among central bankers?

  4. Which of the following is unlikely to be a consequence of a surge in oil prices?

  5. The author considers the inflationary threat from union pay negotiations in the US to be:

  6. How much in bonds is the Fed expected to sell back this year?

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  • Describe some of the challenges created by the bond markets and inflation
  • Explain what factors are affecting inflation right now
  • Identify the role of the unions in the US

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