- 03 September 2010
- 27 August 2010
- 16 August 2010
- 21 July 2010
- 15 July 2010
- 24 June 2010
- 23 June 2010
- 30 June 2010
Welcome to Schroders Talking Bonds
Welcome to Talking Bonds - a gateway to all the latest news and views from Schroders' global team of fixed income professionals. We've been investing in fixed income assets for over 50 years and given the significant opportunities in today's markets, we're excited about the future.
Talking Bonds is designed to give you access to the views of our 100-strong fixed income team on a wide range of industry and bond investment issues, as well as keep you up-to-date with what's happening in the economy.
You can subscribe to receive alerts by e-mail when a new item is published, and can even e-mail us directly with any questions you might have.
Quickview: Big number hides underlying weakness
As the Office of National Statistics revises up its estimate of UK GDP growth for the second quarter from 1.1% to 1.2% this article delves into the foundations of such a strong headline number.
Summary:
ONS revises its second quarter
Azad Zangana, European Economist, Schroders
Posted 27th August 2010
Interview with Keith Wade - is the global economic recovery sustainable?
In this webcast interview Keith Wade looks at the prospects for the world economy - and how he would invest
or read the key points below:
Do you think the global economic recovery is sustainable from here?
Keith Wade, Chief Economist, Schroders
Posted 17th February 2010
Schroders Quickview: Gilt market heading for downgrade
According to David Scammell, recovery in UK economic growth will help Britain's troubled finances but will be no panacea...
In summary:
– A recovery in UK economic growth will help Britain’s troubled finances, but is no panacea. The country urgently needs a credible and enforceable austerity plan
David Scammell, Head of European and UK Interest Rate Strategies, Schroders
Posted 4th February 2010
Economic & Strategy Viewpoint
Read the latest views from our economists..
Global: When growth is bad
Keith Wade, Chief Economist, Schroders
Posted 1st February 2010
Record jump in UK inflation
Today's surprise in the CPI will put inflation pack on the agenda...
Azad Zangana, European Economist, Schroders
Posted 19th January 2010
Economic and Strategy Viewpoint
Read the latest views from our economists...
Access Economic and Strategy Viewpoint in full here
Global: Themes for 2010
Keith Wade, Chief Economist, Schroders
Posted 1st January 2010
Schroders Quickview: US comes out of recession
The
Keith Wade, Chief Economist, Schroders
Posted 30th October 2009
Investment Grade Credit: This is only just the start...
Given the buzz surrounding credit since the beginning of the year, investors may be wondering how much more this asset class can offer. In this article, Adam Cordery outlines why he believes the huge opportunity relative to cash and government bonds still looks very far from over.
2009 so far ...
Given significant investor interest and strong returns since January, credit has already established itself as one of the ‘hot' markets of 2009. Somewhat inevitably, this development has prompted talk as to whether the investment window for credit has already closed, and, indeed, whether we are now witnessing the development of yet another bubble.
Adam Cordery, Fund Manager, Head of European and UK Credit Strategies, Schroders
Posted 29th June 2009
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The Mexican standoff in European credit
Sarang Kulkarni examines the current battle between the bulls and the bears
Sarang Kulkarni, Fund Manager, Fixed Income, Schroders
Posted 3rd September 2010
Economics and Strategy Viewpoint - August 2010
Key points are:
Read more Global: Has the US economy stalled?
Keith Wade, Chief Economist, Schroders
Posted 24th August 2010
Quickview: China overtakes Japan but does it matter?
At some point in June this year
Chinese economic output totalled US$1.337 trillion in the second quarter, compared to US$1.288 trillion in
Nathan Gibbs, Fund Manager, Japanese Equities, Schroders
Posted 17th August 2010
US economic recovery: a period of paralysis?
Whatever confidence there was left in the US recovery had all but evaporated by the end of last week.
While the Federal Reserve's announcement aimed to address some of the risks facing the US economy, investors should be aware that:
Ed Fitzpatrick, Fund Manager, Fixed Income, Schroders
Wes Sparks, Head of US Fixed Income, Schroders
Wes Sparks, Head of US Fixed Income, Schroders
Posted 16th August 2010
The power of technical analysis
Jamie Fairest, Fixed Income Fund Manager, discusses the benefits of technical analysis and how profits can be realised from using these techniques.
Technical analysis can prove a useful tool in the search for additional sources of return. The power of technical analysis can be utilised over any time scale and across all asset classes. The benefits of technical analysis and how profits can be realised from using these techniques are discussed in this article along with current projections.
Jamie Fairest, Fixed Income Fund Manager, Schroders
Posted 13th August 2010
Property Research Team, Property, Schroders
Posted 11th August 2010
Cold Turkey - European commercial property in an era of debt rationing
Mark Callender, Head of International Property Research, discusses the prospects for the European commercial property market
Mark Callender, Head of International Property Research, Schroders
Posted 30th July 2010
Bank stress tests: one small step for the eurozone. One giant leap required
The message from policymakers to banks in the region is a cosy one
Key points:
Jamie Stuttard, Head of European and UK Fixed Income, Schroders
Roger Doig, Credit Analyst, Schroders
Roger Doig, Credit Analyst, Schroders
Posted 26th July 2010
UK GDP: the economy takes off
Economists, commentators and the markets have been collectively wowed by UK GDP figures released.
Preliminary estimates of GDP growth for between April and June 2010 showed the economy grew by a huge 1.1%, which is a tremendous rebound from the disappointing 0.3% growth achieved in the first quarter. This is the fastest period of growth for four years.
Azad Zangana, European Economist, Schroders
Posted 23rd July 2010
Keith Wade, Chief Economist, Schroders
Posted 23rd July 2010
Covered Bond Market - Forever After...
Lucette Yvernault, Fixed Income Fund Manager, explores the future of the covered bond market
As the European Central Bank (ECB) closes its book on the Covered Bond Purchasing Programme (CBPP) unveiled a year ago, the European covered bond market is trying to regain momentum and continue to service a banking system which has been severely impacted by the recent sovereign misdemeanours. At the same time, the outright sanity of the European banking sector is endangered by the delayed approval of Basel III framework and the contagion of the American Financial Reform Bill.
Lucette Yvernault, Fixed Income Fund Manager, Schroders
Posted 22nd July 2010
European banks: stress-tested with a tickle stick?
Justin Bisseker shares his thoughts on the European bank stress tests ahead of Friday's results
Justin Bisseker, European Banks Analyst, Schroders
Posted 22nd July 2010
Restoring American financial stability
On 21 July 2010, the US Financial Reform Bill was signed into law. Harold Thomas outlines the major points and the possible effects from a fixed income perspective
In summary:
Harold Thomas , Credit Analyst, Schroders
Posted 21st July 2010
Quickview: Japan's political deadlock
After failing to win a majority in the national elections, Japan's government finds itself facing a struggle to pursue its agenda for reducing the country's deficit
Although expectations for a DPJ victory had diminished in recent weeks, the actual outcome was worse than expected and increases the chance of political deadlock for the next couple of years. Any policies aimed at more radical reforms are likely to be blocked in the Upper-House.
For the region’s equity market, there are likely to be both positive and negative ramifications.
Nathan Gibbs, Fund Manager, Japanese Equities, Schroders
Posted 15th July 2010
Property Research Team, Property, Schroders
Posted 15th July 2010
European equities: a half-time reality check
Significant investor concern regarding a possible eurozone break-up is creating opportunities for European equity investors
In summary
• Clearly Greece is in a distressed situation, but we believe this is an isolated event and the single currency will survive
Posted 12th July 2010
Economics & Strategy Viewpoint - June 2010
Read the latest views from Schroders' Economists
Global: The return of risk aversion
• Doubts about sovereign creditworthiness and the economic recovery have led to a horrid performance from equity markets in the second quarter. With government bonds in the US, Japan and Germany rallying, risk aversion has increased sharply.
Keith Wade, Chief Economist, Schroders
Posted 30th June 2010
UK Emergency Budget 2010: Reality unveiled....
Azad Zangana comments on the implications of the Con-Lib coalition's tough emergency budget....
Summary
Azad Zangana, European Economist, Schroders
Posted 24th June 2010
Where we are now?: Developed foreign exchange markets
The valuation boundaries in our sterling/dollar fair-value model have continued to drift downwards, with the central fair value rate having fallen from around $1.70/£ at the turn of the year to around $1.60/£ now.
Posted 23rd June 2010
Emergency Budget: More cuts to come
The new coalition government’s first budget is an ambitious one, announcing austerity measures that are even tougher than predicted.
The leap in VAT to 20% goes beyond our January forecast of 19%, and suggests future spending cuts will be harsher still, particularly given that the Chancellor is standing by his 80:20 deficit-busting ratio of spending cuts to tax hikes. While the budget is austere, we believe the real pain will come in October with the Comprehensive Spending Review.
Azad Zangana, European Economist, Schroders
David Scammell, Head of European and UK Interest Rate Strategies, Schroders
David Scammell, Head of European and UK Interest Rate Strategies, Schroders
Posted 23rd June 2010
Quickview: The implications of a flexible renminbi
In a major shift in policy, The People’s Bank of China (PBoC) announced that the economic recovery had opened the way for a ‘return to flexibility’ in the renminbi (RMB) exchange rate.
Posted 21st June 2010
OBR slashes UK growth forecast
Our European economist on the outlook for UK growth
Key points:
- Newly-formed OBR cuts UK growth estimate for 2011 from 3.25% to 2.6%, nearer to our forecast of 2.4%.
- Unlike the OBR, we expect growth to moderate in 2012 as the effects of fiscal tightening come through.
- Longer-term trend growth rate also expected to fall.
Azad Zangana, European Economist, Schroders
Posted 14th June 2010
What do you get for €750 billion?
€750 billion is a lot of money. Jamie Stuttard asks what the second Eurozone bail-out package has bought for Europe so far
Jamie Stuttard, Head of European and UK Fixed Income, Schroders
Posted 8th June 2010
Global volatility and the impact on Asia
David MacKenzie reflects on how recent macro developments are likely to impact investors in Asia
Asian markets have not been immune to recent bouts of market volatility and weakness. As we are all aware, in times of uncertainty, risky assets are sold down and Asian markets, despite the strong fundamental economic support, are still viewed as a risky play within the equity basket. In the following article, we reflect on how recent macro events are likely to impact investors in Asia.
David MacKenzie, Asian Equities Product Manager, Schroders
Posted 7th June 2010
Property Research Team, Property, Schroders
Posted 2nd June 2010
Gilt yields kept in check
David Scammell discusses recent gilt market moves in the wake of the UK's General Election and the European sovereign debt crisis
In summary
David Scammell, Head of European and UK Interest Rate Strategies, Schroders
Posted 21st May 2010
US banking reform: Washington goes after Wall Street
Chris Costanza, US Large Cap Analyst, outlines the potentially far-reaching effects of US government efforts to reform the banking sector
US efforts to reform the financial sector have put a bulls-eye on the back of capital markets and large bank wholesale funding. This will create headwinds for Goldman Sachs, Morgan Stanley, Citigroup, JP Morgan, and Bank of America and, to a lesser extent, the super-regional banks.
Read more Chris Costanza, US Large Cap Analyst, Financials, Schroders
Posted 19th May 2010
BaFin plays oddball to the market's hardball
Jamie Stuttard outlines his thoughts on German financial regulator BaFin's decision to ban naked short selling on eurozone sovereign debt
In summary
Jamie Stuttard, Head of European and UK Fixed Income, Schroders
Posted 19th May 2010
Webcast: Global Economic Outlook
Keith Wade, Chief Economist, discusses the impact of recent economic developments as global governments move to ease the recovery process
Click here to watch the webcast
In the interview Keith discusses:
Keith Wade, Chief Economist, Schroders
Posted 19th May 2010
Quickview: UK RPI inflation at highest level since 1991
Azad Zangana, European Economist, outlines the implications of today's inflation numbers
The annual inflation rate of the consumer price index (CPI) rose to a 17-month high of 3.7% in April, from 3.4% in March. This morning's data release was significantly higher than consensus estimates of 3.5%. Worryingly, core annual inflation, which excludes energy, food and alcoholic beverages, also rose to 3.1% from 3.0% a month earlier.
Azad Zangana, European Economist, Schroders
Posted 18th May 2010
Quickview: Can Cameron’s coalition calm the markets?
Azad Zangana, European Economist, discusses what the
David Cameron replaced Gordon Brown as the UK's Prime Minister yesterday evening after it become evident that Nick Clegg's Liberal Democrat party favoured entering a coalition government with the Conservatives, rather than the outgoing Labour Party.
Azad Zangana, European Economist, Schroders
Posted 12th May 2010
Property: is international diversification dead?
Mark Callender explains why he believes the global crisis has shifted the traditional logic associated with international property investing
The traditional argument for cross-border property investment is that local occupier markets are subject to their own peculiar demand and supply forces. They, therefore, tend to peak and trough at slightly different times. This lack of synchronisation means that returns on an international property portfolio should be less volatile than those for a purely domestic portfolio.
Read more Mark Callender, Head of International Property Research, Schroders
Posted 10th May 2010
Quickview: Europe fights back
As markets across Europe welcome the EU's €750bn loan package, Azad Zangana, European Economist, outlines his views on the move
Azad Zangana, European Economist, Schroders
Posted 10th May 2010
Schroders Quickview: UK election negative for gilts?
David Scammell, Head of UK and European Interest Rate Strategies, asks if the result of the
The UK election result has seen UK government bond prices fall today. However, the question is whether this is likely to be the start of a longer-term trend?
Given the considerable concerns over the sovereign debt crisis in peripheral Europe (which has been negative for equities), safe haven assets such as gilts, US treasuries and German bunds should be in demand. However, with the bond market increasingly questioning what a safe haven is, there are questions over the UK gilt market.
David Scammell, Head of European and UK Interest Rate Strategies, Schroders
Posted 7th May 2010
Election comment: UK enters corridor of uncertainty
Keith Wade, Chief Economist, discusses what a hung parliament means for UK public finances
So near, but so far for David Cameron. Despite becoming the largest party in parliament he has not managed to get the 326 seats needed for a majority. Prior to the election many saw this as the worst possible result. Markets want bold, decisive action on the UK budget deficit which reached £163 billion, nearly 12% of GDP, in the last financial year.
Keith Wade, Chief Economist, Schroders
Posted 7th May 2010
Debt contagion and the Eurozone
Jamie Stuttard, Head of European and UK Fixed Income, takes an in-depth look at government bond and banking sector contagion in European fixed income markets
Key points
Jamie Stuttard, Head of European and UK Fixed Income, Schroders
Posted 7th May 2010
Credit returns are still not over
Adam Cordery discusses the current outlook for European credit and why there are still good opportunities on offer
Risk appetite has clearly been hit by the downgrades of Greece, Portugal and Spain, and investor attention is now heavily focused on contagion risks. However, we believe there are several things to bear in mind, which keep us relatively sanguine about the outlook for European corporate bonds.
Adam Cordery, Fund Manager, Head of European and UK Credit Strategies, Schroders
Posted 7th May 2010
LDI Monthly - gilts and swaps
Read the latest thoughts from Schroders' Liability-Driven Investment Team
This month, we pull the two strands together to understand how we can consider both LDI ‘asset classes’ (i.e. gilts and swaps) in respect of both parts of our exposure, identify which is the more favourable for each, and how the exposure can be delivered.
Ross Pritchard, Liability Driven Investment Solutions Manager, Schroders
Posted 5th May 2010
The challenge of inflation for emerging market debt investors
Warren Hyland, Fixed Income Fund Manager, addresses the particular challenges of inflation for investors in emerging market debt
As central banks loosen monetary policy and governments inject capital through fiscal expansion, more money enters the system, lifting incomes and ultimately creating inflation. Private credit growth can be considered a lead indicator for monetary inflation. Looking across the emerging markets, the only region that has experienced private credit growth acceleration over the past 12 months is Asia.
Warren Hyland, Fund Manager - Global Fixed Income, Schroders
Posted 4th May 2010
UK election - one week to go...
UK election update - read the latest views of our experts Keith Wade, Azad Zangana, David Scammell, Richard Buxton and Ian Mason
In summary:
Read more
Azad Zangana, European Economist, Schroders
David Scammell, Head of European and UK Interest Rate Strategies, Schroders
Ian Mason , Head of UK Property Fund Management, Schroders
Keith Wade, Chief Economist, Schroders
Richard Buxton, Head of UK Equities, Schroders
David Scammell, Head of European and UK Interest Rate Strategies, Schroders
Ian Mason , Head of UK Property Fund Management, Schroders
Keith Wade, Chief Economist, Schroders
Richard Buxton, Head of UK Equities, Schroders
Posted 30th April 2010
What the Greece crisis means to European banks
Roger Doig, Credit Analyst, discusses the extent of European bank exposure to Greek government debt
The market continues to be concerned about the impact of a Greek government default or debt restructuring on the European banking sector. These concerns have been fanned by uncertainty over who owns Greek government debt, and by some rather misleading BIS statistics that suggest exposures are significantly greater than they actually are.
Roger Doig, Credit Analyst, Schroders
Posted 30th April 2010
Greek sovereign debt crisis
Azad Zangana provides his latest views on the sovereign debt crisis, following the downgrade of Greece and Portugal
In summary:
Azad Zangana, European Economist, Schroders
Posted 28th April 2010
Is a hung parliament a potential risk to the UK gilt market?
David Scammell and Thomas Sartain give their views on the potential impact of a hung parliament on gilts.
David Scammell, Head of European and UK Interest Rate Strategies, Schroders
Thomas Sartain, Fund manager, Pan European Fixed Income , Schroders
Thomas Sartain, Fund manager, Pan European Fixed Income , Schroders
Posted 22nd April 2010
Where next? The cyclical framework
Schroders’ cyclical model shows how the performance of asset classes varies with the stage of the economic cycle.
The cyclical framework is designed to assist asset allocation across a broad range of asset classes, and aims to identify different factors that are key in driving market returns through each stage of the cycle.
So where next?
Harish Vekaria, Quantitative Analyst - Multi-Asset, Schroders Economics and Strategy Team
Posted 21st April 2010
UK Property Market Commentary
While it is premature to talk of recovery, there are signs that parts of the occupier market are beginning to stabilise
According to CBRE, the overall vacancy rate in central London offices fell in the fourth quarter of 2009 as occupiers withdrew space that they had previously been trying to sublet. This resulted in a stabilisation of prime rents in both the City and West End and landlords were able to cut incentives.
Posted 21st April 2010
Continental European Property Market
While the recovery in the eurozone economy slowed in the fourth quarter of 2009, we expect growth of 1-1.5% per annum in 2010-11
The best performing economies are likely to be the Czech Republic and Poland which should see further domestic investment in manufacturing. Norway and Sweden also stand to gain from having freely floating currencies against the euro.
Posted 21st April 2010
Economics & Strategy Viewpoint - March 2010
Read the latest views from Schroders' Economists
Global: The fiscal cloud on the horizon
Keith Wade, Chief Economist, Schroders
Posted 29th March 2010
Greece - the solution lies within
David Scammell shares his latest views on the Greek sovereign debt crisis...
With bond markets fixated on the political posturing surrounding a Greek rescue package, it is important to stay focused on the real issue here - namely the long-term sustainability of Greek public finances. The country has quite clearly mismanaged its budget over a number of years, which has been cleverly disguised until recently by some creative accounting. Major reforms are now urgently required. In particular, there is a structurally low level of taxation and an over-generous pension system.
David Scammell, Head of European and UK Interest Rate Strategies, Schroders
Posted 25th March 2010
Schroders Quickview: UK Pre-election Budget 2010
Access the quickview from Azad Zangana and David Scammell.
Key points, Azad Zangana, European Economist:
The Chancellor’s 2010 Budget, in all likelihood just weeks before a General Election, revealed little about how the government will cut the deficit
Azad Zangana, European Economist, Schroders
David Scammell, Head of European and UK Interest Rate Strategies, Schroders
David Scammell, Head of European and UK Interest Rate Strategies, Schroders
Posted 25th March 2010
UK Budget 2010 - Chancellor borrows only £167 billion. Success?!?!
Azad Zangana takes a more in-depth look at the Budget
Azad Zangana, European Economist, Schroders
Posted 25th March 2010
Schroders Quickview: UK economy strengthening
Today’s strong UK survey data suggests a reduced probability of a double-dip recession...
...However, we remain cautious over growth prospects for 2010. Although business activity is picking up, weak labour market conditions and the prospect of fiscal tightening are likely to weigh on the consumer...
Azad Zangana, European Economist, Schroders
Posted 3rd March 2010
Schroders Economic and Strategy Viewpoint
Read the latest views from Schroders' economists
Keith Wade, Chief Economist, Schroders
Posted 1st March 2010
Outlook for UK Inflation-Linked Bonds
With concerns over rising prices at the forefront of investors' minds, David Scammell comments upon the outlook for UK inflation and the benefits of holding inflation-linked bonds.
These are challenging times for the UK inflation-linked bond market. Over the last three years, inflation has been much more volatile than in the preceding ten years, reflecting an increase in size and frequency of short-run factors. Thus, the retail price index (RPI) printed 3.7% in January, rising sharply from 2.4% in December. The Governor of the Bank of England, in an open letter to the Chancellor, described the spike as 'temporary', driven by the re-instatement of VAT at 17.5% and the continued increase in the price of crude oil and export prices.
David Scammell, Head of European and UK Interest Rate Strategies, Schroders
Posted 23rd February 2010
Schroders Quickview: UK inflation hits a 14-month high
Inflation figures spiked up in January, largely due to the reinstatement of the VAT rate at 17.5%
Azad Zangana, European Economist, Schroders
David Scammell, Head of European and UK Interest Rate Strategies, Schroders
David Scammell, Head of European and UK Interest Rate Strategies, Schroders
Posted 16th February 2010
Schroders Quickview: German growth stalls as eurozone struggles with recovery
Azad Zangana and David Scammell comment on today's news of stalling Eurozone growth.
Azad Zangana, European Economist
Read more Today's preliminary estimates show that German growth stalled in the final quarter of 2009 while eurozone growth as a whole slowed markedly. The German Office of Statistics estimated that quarterly GDP growth slowed significantly from 0.7% in the third quarter, to no growth in the fourth quarter of last year. Meanwhile, Eurostat estimated that eurozone growth as a whole slowed from 0.4% in Q3 to just 0.1% in Q4, disappointing consensus estimates of 0.3%.
Azad Zangana, European Economist, Schroders
David Scammell, Head of European and UK Interest Rate Strategies, Schroders
David Scammell, Head of European and UK Interest Rate Strategies, Schroders
Posted 12th February 2010
Will the financial crisis be followed by a surge in inflation?
As investors grow increasingly concerned about the threat of inflation, Keith Wade examines they key factors driving inflation and the outlook over the short and medium term...
Inflation is on the rise again...
Keith Wade, Chief Economist, Schroders
Posted 11th February 2010
European high yield: new year, new issues
We examine the expected trends for high yield issuance in 2010 and look at the factors that would contribute to the success of new issues.
Sarang Kulkarni, Fund Manager, Fixed Income, Schroders
Posted 5th February 2010
Schroders Quickview: Greek debt crisis
Schroders' Global Fixed Income desk reflects on the latest developments in the Greek debt crisis.
Beware of Greeks bearing gifts?
Schroders , Global Fixed Income Desk, Schroders
Posted 4th February 2010
Where will the growth come from?
As the US locomotive appears to be running out of steam, Keith Wade contemplates what will succeed it as the engine of global growth.
Investors had a roller coaster ride through 2009 as fears of another Great Depression gave way to widespread expectations of recovery. Business surveys indicate that we are in the midst of a rebound in the world economy led by the industrial sector. Yet there are doubts as to how far this can take us. Companies are currently increasing production to rebuild their stock levels, but once this process is complete the question is what will drive future sales growth?
Keith Wade, Chief Economist, Schroders
Posted 1st February 2010
Schroders Quickview: UK exits recession
Azad Zangana and Thomas Sartain comment on news that the UK has exited the recession and the implications for the economy and gilt market.
Azad Zangana, European Economist
Preliminary estimates of GDP growth between October and December 2009 showed the economy grew by a 0.1% - ending the longest and deepest recession since the Second World War.
Azad Zangana, European Economist, Schroders
Posted 26th January 2010
The long-run relationship between credit spreads and government bond yields
Government bond yields are likely to rise in 2010 and 2011. What effect, if any, will higher government yields have on corporate bond spreads?
In summary:
Read more Jamie Stuttard, Head of European and UK Fixed Income, Schroders
Sarang Kulkarni, Fund Manager, Fixed Income, Schroders
Sarang Kulkarni, Fund Manager, Fixed Income, Schroders
Posted 15th January 2010
Sustainability of European public finances
Now that the worst of the crisis is over, the question that markets are asking is at what cost? And which countries are running unsustainable deficits?
- European public finances are a mess. Fears of deflation and unprecedented intervention by central banks have so far kept government bond yields relatively low. Now that the worst of the crisis is behind us and recovery underway, public finances are in the spotlight with bond vigilantes preparing assaults on the most vulnerable
Azad Zangana, European Economist, Schroders
Posted 15th January 2010
2010: A year in Asian bonds
How Phuang Goh reveals his expectations for Asian bond markets in 2010.
How Phuang Goh, Head of Asian Fixed Income, Schroders
Posted 4th January 2010
2010: Outlook for Investment-Grade Credit
Jamie Stuttard, Head of Pan-European Fixed Income, shares his thoughts on the outlook for investment-grade credit markets in 2010...
Read Jamie's article in full here
Who would make a forecast for credit markets after the strongest set of returns versus government bonds in 77-years! Credit markets indeed enjoyed excellent returns in 2009. However as we compare the performance of a number of asset classes, many have rallied a long way in the last 9-months, fuelled by 0% central bank rates.
Jamie Stuttard, Head of European and UK Fixed Income, Schroders
Posted 4th January 2010
Quickview: Deleveraging - a credit view on banks
Roger Doig reveals how deleveraging is shaping the attractiveness of financials credit.
Released last week, the US Federal Reserve Z.1 Flow of Funds data for the third quarter 2009 included a number of interesting points:
Read more - Household sector debt deleveraging accelerated during the quarter, reaching -2.6% on an annualised basis.
Roger Doig, Credit Analyst, Schroders
Posted 14th December 2009
Quickview: Greek and Spanish debt downgraded
Adam Cordery comments on Standard & Poor's decision to cut the debt ratings for both Greece and Spain.
During the week, both Greece's and Spain's debt ratings were downgraded by the rating agencies Fitch and Standard & Poor's. S&P put Greece and Spain on negative outlook. Fitch cut Greece's debt rating to the lowest of any of the 16 euro nations. Greek and Spanish government bonds sold off heavily in the week.
Read more The markets are now differentiating between different countries in the way they price risk, and as a result euro government credit spreads and bond prices will be more volatile.
Adam Cordery, Fund Manager, Head of European and UK Credit Strategies, Schroders
Posted 11th December 2009
Quickview: Pre-Budget Report
Richard Buxton, Azad Zangana and Warren Hyland comment on today's Pre-Budget Report and the likely consequences for the UK economy, equities and gilts.
Azad Zangana, European Economist, Schroders
Richard Buxton, Head of UK Equities, Schroders
Warren Hyland, Fund Manager - Global Fixed Income, Schroders
Richard Buxton, Head of UK Equities, Schroders
Warren Hyland, Fund Manager - Global Fixed Income, Schroders
Posted 9th December 2009
Quickview: Gilts and the Pre-Budget Report
David Scammell comments on the implications of the Pre-Budget Report for gilt investors.
David Scammell, Head of European and UK Interest Rate Strategies, Schroders
Posted 9th December 2009
The case for gilts: It's about the economy, stupid!
David Scammell shares his latest views on the gilts market
- Many people dislike gilts
- Yields are low and quantitative easing (QE) has seen the Bank of England (BoE) effectively fund the Treasury to the tune of £200 billion
David Scammell, Head of European and UK Interest Rate Strategies, Schroders
Posted 26th November 2009
Michael Foggin, Credit Derivatives Trader, Schroders
Posted 19th November 2009
Crystal Ball 2010
After an extraordinary year for financial markets, Alan Brown reflects on what 2010 may have in store for investors...
Access the article as a pdf here
Introduction:
As we say almost every year, crystal ball gazing is a hazardous occupation at the best of times, and this year is certainly no different!
Here's how we concluded our Crystal Ball in December of last year:
Alan Brown, Group Chief Investment Officer, Schroders
Posted 19th November 2009
What next for the credit party?
On course for their best year since 1932, it's been quite a party for corporate bond investors. So, where can markets go from here?
Jamie Stuttard, Head of European and UK Fixed Income, Schroders
Posted 9th November 2009
CIT Group files for Chapter 11
Wes Sparks and Harold Thomas comment on the implications of CIT Group's filing for Chapter 11 bankruptcy protection - both for the company's bondholders and the wider market and economy.
Harold Thomas , Credit Analyst, Schroders
Wes Sparks, Head of US Fixed Income, Schroders
Wes Sparks, Head of US Fixed Income, Schroders
Posted 3rd November 2009
Schroders Economic and Strategy Viewpoint
Key points:
Global: The dollar, re-balancing and the world economy (see page 2 of the full document)
Keith Wade, Chief Economist, Schroders
Posted 2nd November 2009
Quickview: UK inflation at five year low
Keith Wade comments on the latest UK inflation numbers.
It was announced yesterday that the Consumer Price Index (CPI) had fallen to 1.1% - its lowest level since September 2004. The Retail Price Index (RPI) also fell by 0.1% to -1.4% in September. The results took the market by surprise as many economic commentators had not anticipated inflation falling so far, so fast.
Read more What these latest inflation numbers illustrate is that, in spite of recent signs of recovery, deflationary forces are still at work in the UK economy. Businesses are operating with a lot of spare capacity having cut production sharply l
Keith Wade, Chief Economist, Schroders
Posted 14th October 2009
Bank of England delays decision on quantitative easing
Attention now turns to the key November meeting, when the Bank must decide whether to further extend quantitative easing - in other words, buy even more gilts
Key points:
David Scammell, Head of European and UK Interest Rate Strategies, Schroders
Posted 9th October 2009
The case for inflation linked bonds
We think that inflation will be structurally higher through the next cycle, and that inflation-linked bonds should outperform nominal bonds
Nick Gartside, Head of Global Fixed Income, Schroders
Posted 5th October 2009
Economic and Strategy Viewpoint
Read the latest views from our economists.
Read the Economic and Strategy Viewpoint here
Global: Central bank focus on the real economy creates bubble risk
Keith Wade, Chief Economist, Schroders
Posted 25th September 2009
Webcast interview: Opportunities in global fixed income
Nick Gartside shares his outlook for global bond markets and reveals where he is finding the best opportunities.
Nick Gartside, Head of Global Fixed Income, Schroders
Posted 7th September 2009
Webcast interview: Has the global economy turned a corner?
Keith Wade discusses the latest economic developments and reveals his outlook for the global economy for the coming months.
Keith Wade, Chief Economist, Schroders
Posted 1st September 2009
France and Germany exit recession
Data released yesterday surprised investors and economists alike, showing that the French and German economies grew by a provisionally estimated 0.3% in the second quarter, bringing Europe's two largest economies out of recession.
Azad Zangana, European Economist, Schroders
Posted 14th August 2009
A perspective on the Asian high yield bond market
Why the market has not developed as expected - but why it should continue to grow over time
Asia's high yield market, though more liquid than in late 2008 and early 2009, is virtually closed for new issuance. Nevertheless, there are several good reasons why this market is an attractive long-term asset class.
Read 'A perspective on Asian high yield...'
Richard Brown, Head of Credit Research, Asia, Schroders
Posted 5th August 2009
Schroders Quickview: That shrinking feeling
Today’s UK second quarter GDP release comes as a blow to renewed optimism that the end of the recession may be close, if not already here
Read 'Schroders Quickview: that shrinking feeling' here
Key points :
— The acute weakness in the construction sector was the key to the surprise in today’s data, reflecting the lack of confidence in the economy and the large fall in the investment in buildings
Azad Zangana, European Economist, Schroders
Posted 24th July 2009
Wear sunscreen this summer
A tactical approach to credit portfolio management
The sun has been shining on credit markets - and we expect it to do so for the next few years. But, in the short-term, credit managers face an uncertain summer. In this article Jamie Stuttard explores some protection trades...
Jamie Stuttard, Head of European and UK Fixed Income, Schroders
Posted 24th July 2009
Bank capital instruments: can hybrids be reinvented?
Why hybrid debt turned out to be toxic; further complications, and what happens now?
One of the most important differentiators of investment grade bond fund performance over the last 12 months has been exposure to bank hybrid Tier 1 debt. Over the last year, the total return on European Tier 1 bonds has been -25%, and with issuers now buying back these bonds at below par prices, there is no prospect of that performance being recovered. It represents a permanent loss of principal for those who held these bonds.
Read more Roger Doig, Credit Analyst, Schroders
Posted 23rd July 2009
Keith Wade, Chief Economist, Schroders
Posted 22nd July 2009
No bail out for CIT
The US government refuses to rescue one of America's leading commercial lenders...
Adam Cordery, Fund Manager, Head of European and UK Credit Strategies, Schroders
Posted 16th July 2009
Where has all our fixed income liquidity gone - and will it return?
One of the effects of the credit crunch has been a significant reduction in liquidity in fixed income government and corporate bond markets...
Nick Robinson, Head of Trading, Fixed Income, Schroders
Posted 14th July 2009
Who is buying UK gilts?
As the UK gilt market grows at an unprecedented rate, at some point more investors will be needed to support the market
In brief: The UK gilt market is growing at an unprecedented rate. While the dominance of insurance companies and pension funds is clearly waning, there is no reason to suppose that the structural demand from these investors will fall.
Read more David Scammell, Head of European and UK Interest Rate Strategies, Schroders
Posted 3rd July 2009
Webcast: Focus on inflation
Signs of economic recovery have raised questions about the outlook for inflation. Keith Wade and Nick Gartside discuss their views on inflation and what the future could hold for inflation-linked bonds.
Keith Wade, Chief Economist, Schroders
Nick Gartside, Head of Global Fixed Income, Schroders
Nick Gartside, Head of Global Fixed Income, Schroders
Posted 30th June 2009
Keith Wade, Chief Economist, Schroders
Posted 30th June 2009
UK inflation surprise
CPI surprised to the upside in May and it has become clearer that the scenario of a deflationary spiral is now very unlikely
—
Azad Zangana, European Economist, Schroders
Posted 16th June 2009
High Yield: A generational opportunity
After a dismal 2008, high yield has outperformed nearly every other major asset class over the year-to-date. Find out what Wes Sparks believes is driving the rally...
Access this article as a pdf here
2009 so far ...
After the worst year in the history of global high yield bonds in 2008 (-26.2%), 2009 so far has been a different story altogether. High yield has outperformed nearly every other major asset class, including equities, and has already recovered last year's losses, returning over 28% to the end of May*.
Wes Sparks, Head of US Fixed Income, Schroders
Posted 10th June 2009
Schroders Quickview: S&P UK Outlook Downgrade
Azad Zangana, Adam Cordery and David Scammell give their views on Standard and Poor's (S&P) announcement of its downgrading of the UK outlook from 'stable' to 'negative'.
View from our European Economist
Standard & Poor's (S&P) downgraded its outlook for the UK from ‘stable' to ‘negative' this morning, but reaffirmed its current sovereign credit ratings of AAA on long-term debt and A-1 on short-term debt.
Adam Cordery, Fund Manager, Head of European and UK Credit Strategies, Schroders
Azad Zangana, European Economist, Schroders
David Scammell, Head of European and UK Interest Rate Strategies, Schroders
Azad Zangana, European Economist, Schroders
David Scammell, Head of European and UK Interest Rate Strategies, Schroders
Posted 21st May 2009
Are banks emerging from the woods?
Harold Thomas and Roger Doig discuss the outlook for global banks and the implications for investors in financials debt.
Harold Thomas , Credit Analyst, Schroders
Roger Doig, Credit Analyst, Schroders
Roger Doig, Credit Analyst, Schroders
Posted 19th May 2009
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