FICC Focus International Rates Alpha With Invesco’s Baijal: Macro Matters
Aug 21, 2025
Hemant Baijal, Head of Macro Alpha Strategies at Invesco, shares his insights on the dynamics of global rates and FX risks. He highlights how the future of the dollar is influenced by unhedged dollar assets and explores economic factors affecting investment strategies. The discussion delves into the impact of U.S. economic trends on global bond markets and examines currency flows amidst evolving credit landscapes. Baijal also addresses risk assessment for international and emerging markets, emphasizing the significance of strategic asset allocation.
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Start With U.S. Versus Non-U.S. Growth
- Invesco starts allocation with a six- to nine-month macro outlook focused on U.S. vs non-U.S. growth.
- That split determines risk-taking across rates, FX, and credit for generating active returns.
Balance Short-Term Data With Forward Views
- Compress tactical horizons while keeping a forward-looking view because central banks (especially the Fed) act on short-term data.
- Balance current data with plausible evolution rather than reacting solely to headlines.
Alpha From Curve Shape, Not Levels
- In developed markets rates are range-bound and the main alpha comes from curve positioning rather than outright yields.
- Japan long end and Australia's long end are notable exceptions with more attractive dislocations.