There are also concerns that the uncertainty surrounding the necessary debt for deficit spending could destabilize the $27 trillion Treasury market, a cornerstone of the global financial system.
As 2023 concludes, the bond market has witnessed a remarkable rally, bolstered by the strength of the U.S. economy and a reduction in inflationary pressures.
The traditional 60/40 investment portfolio recorded 13% growth in 2023, its third-best year since 2008. Investors ponder if favorable conditions in H2 of 2023 will continue in 2024.
Investors have accumulated record amounts of cash & equivalents to hedge against volatility, but fund managers are urging investors to put money to work in bond markets.
Market participants are eagerly awaiting for the March personal consumption expenditure (PCE) price index report from the Bureau of Economic Analysis on Friday (April 28), before the market opens.