Yields Climb as Oil, Debt Supply, and a Tighter Fed Reshape Fixed Income
Fixed-income yields rose substantially in the third quarter, driven by three forces: higher oil prices and the likely flow-through of energy costs to inflation as the war with Iran continues; a surge in debt supply needed to fund the artificial intelligence (AI) buildout and finance the U.S. fiscal deficit; and the Fed’s pivot in September to address inflation concerns.
Rates Swing as a New Fed Era Begins
Interest rates took a wild ride in the second quarter of 2026, climbing sharply in April and May as the Iran conflict kept oil prices elevated and the Strait of Hormuz closed.
Uncertainty and the Resilience of Fixed Income
The fourth quarter of 2025 marked the return of a more normal upward-sloping bond yield curve.
Fed Easing Lays the Groundwork for Improved Fixed Income Returns
The fourth quarter of 2025 marked the return of a more normal upward-sloping bond yield curve.
Despite Tariff Tensions, Fixed Income Markets Strengthen as Fed Eases Policy
In Q3 2025, fixed income markets demonstrated resilience amid geopolitical tensions and tariff uncertainties.
Fixed Income Market Performs as Expected Amid Tariffs, Providing a Cushion for Investors
As investors wrestle with tariffs and their potential adverse economic and market effects, bonds are outperforming stocks for the first time in five years.
Despite Early Volatility, Fixed Income Markets Demonstrated Resilience
In the second quarter of 2025, fixed income markets navigated a turbulent landscape dominated by the White House’s shifting tariff policies.
Fixed Income Market Sees Reversal Amid Economic Data and Policy Expectations
The fixed income market experienced a reversal in fortunes during the fourth quarter of 2024. Better-than-expected economic data, a slower decline in inflation, and high expectations about the incoming Trump administration’s policies drove bond yields higher.
Fed Rate Cuts Signals a New Economic Landscape
The third quarter marked a seminal pivot point for the financial markets, as the Fed officially concluded its tightening cycle that began in 2022 by cutting interest rates.
Long-Term Investing in a Shifting Landscape
The second quarter of 2024 provided the clearest signals yet that the Fed’s interest rate hiking cycle is having its intended effect. Consumer demand downshifted, housing slowed, and corporate loan defaults increased.