Goldman Sachs The Markets
Time to buy bonds?
May 2, 2025
Join Lindsay Rosner, head of multi-sector investing at Goldman Sachs Asset Management, as she unpacks the current U.S. bond market landscape. She explores the impacts of the Fed's decisions on credit markets and the implications for investment strategies. Lindsay discusses the delicate balance between Treasuries and corporate bonds, especially amid geopolitical tensions. With insights on the potential recession and opportunities in investment-grade corporate bonds, she provides a compelling look at navigating the complexities of today's fixed income environment.
10:04
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Quick takeaways
- Despite stable yields on Treasuries, the economic landscape has shifted, necessitating investors to reassess their strategies.
- While widening credit spreads indicate caution, investment-grade securities offer attractive opportunities amidst economic uncertainties.
Deep dives
Current Economic Conditions and Interest Rates
Despite recent rate cuts by the Fed, the yields on 10-year Treasuries have remained relatively unchanged, highlighting a shifting economic landscape. Inflation is projected to exceed the Fed's target of 2%, possibly reaching around 3%, while growth is expected to fall below trend levels, potentially only hitting 1%. This combination results in a stable yield level despite the challenges presented by recent tariffs and their impact on economic growth. Investors now find themselves in a situation where, although rates have not declined substantially, the fundamentals have shifted significantly, necessitating a reassessment of their investment strategies.
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