- KRUNGSRI PRIVATE BANKING, led by Mr. Win Phromphaet (center), CFA, Krungsri Executive Vice President, Head of High Net-Worth Division recently host a seminar at The St. Regis Bangkok hotel themed the 'Global Fixed Income Outlook - Bonds are Back?', delivering a comprehensive update on the current global economic landscape and shedding light on investment prospects within the realm of global fixed-income funds for the valued clients. Ms. Tina Adatia (left), Executive Vice President, Fixed Income Strategist of PIMCO, was the distinguished guest speaker, sharing profound investment insights and how to navigate opportunities within the global bond market. She was joined by Ms. Clara Ng (right), Vice President, Account Manager of PIMCO.
This is an excerpt from the commentary provided by Ms. Tina Adatia, which states that: "Our base case at PIMCO assumes that U.S. growth will continue to slow down, inflation will continue to moderate, and a potential risk of recession as some of the growth tailwinds turn to headwinds. We believe the Federal Reserve is close to the end of its hiking cycle but will hold rates at higher levels to control inflation. If we observe weaker growth, the U.S. central bank will have room to cut interest rates potentially in the second half of next year.
The bond market's massive repricing as a result of higher interest rates is affording investors a once-in-a-generation opportunity to invest in fixed income. With yields where they currently are, high quality bonds today can offer potential for equity-like returns of 5-7% without taking uncomfortable risk, and with the benefit of diversification. In addition, there is also the potential of capital appreciation when interest rates eventually move lower.
In terms of investment opportunities, we're focusing on high quality and less economically sensitive areas of the market, while preparing to pivot when pricing in other areas adjusts to reflect changes in fundamentals. Specifically, over the next few years, we expect to rotate into opportunities in the more economically sensitive or lower-rated areas of the public corporate credit markets, and then into the private markets as they finally begin to reflect true fundamentals."