Insight
An Inflection Point
Four of Allspring’s fixed income leaders share their perspectives on the market volatility and banking system turmoil in the wake of SVB’s collapse and their views on what lies ahead for fixed income investing.
Key takeaways
- Following SVB’s collapse, volatility across the banking sector and regulators’ responses in the U.S. and Europe likely mark an inflection point in this tightening cycle.
- From our perspective, liquidity and short-duration portfolios are well positioned for the current environment.
- We’re constructive on the outlook for municipal debt and believe that many opportunities remain for investors to take credit risk.
- Taxable bond investors, in our view, could benefit from the recent upsurge in volatility as it acts to slow growth and temper inflation."
Related insights
Fed officials again kept the federal funds rate unchanged at 5.25–5.50%. Our base case is that they won’t cut rates until they see weakening in prices and the labor market, probably not before fall.