Pimco, one of the world’s largest fixed-income managers, believes market anxiety about the Federal Reserve’s inflation-fighting credibility has gone too far. Marc Seidner, Chief Investment Officer for non-traditional strategies at Pimco, said on August 12 that current US Treasury yields represent an attractive entry point. According to him, the Fed will hold rates steady through the end of 2026, unlike fed funds futures which price in roughly a 50% probability of a 25 basis point rate hike. Seidner’s confidence rests on two pillars: moderating inflation and softening growth signals. He also expects the yield curve to steepen, with longer-dated Treasury yields rising due to fiscal pressure from increased US government borrowing needs.
Source: Read the original article
