For multi-asset investors the options available within fixed income can look uninspiring. Despite yields ticking up in recent weeks, the total returns available on developed market government debt is miniscule.
And, with yields where they are now bonds offer little protection from market volatility, normally one of their main roles in portfolios. Inflation is likely to tick up briefly in 2021 as base effects come into play and commodities grind higher. However, there is still a significant amount of slack in the economy and the likelihood of wage push inflation is low. Therefore, the current rise in inflation expectations is likely to be transitory, despite still being painful for bond investors in the short term. So, is there a bright spot for multi-asset investors who want to allocat...
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