Are investment grade corporate bonds the new safe haven of choice?

In times of uncertainty and geopolitical tensions, corporate bonds with an investment grade rating are commonly considered as the new safe havens.

Year-to-date, this asset class has recorded substantial performance worldwide. The background to this was mainly the monetary policy turnaround of the US Federal Reserve (Fed), which in January abandoned its previous plans of increasing rates.  In addition, growth and inflation expectations continue to be so low in Europe that the European Central Bank (ECB) is more likely to reconsider monetary easing measures than interest rate hikes. The global low interest rate environment therefore lasts even longer. Thus, the yield level on government bond markets has generally fallen significan...