Western economies are finally on a steady recovery path and market volatility is at an all time low. So where do investors think the key opportunities will be in the remainder of 2014?
Chris Iggo, CIO, fixed income, AXA Investment Managers Euro IG bonds Interest rates are a key risk in the fixed income markets. In the UK, the Bank of England has expressed surprise markets have not attached greater probability to interest rates going up before the end of 2014. If markets start to price in a more rapid increase in interest rates because of strong economic data in the second half of the year, volatility will rise. Rising rates and volatility will lead to higher risk premiums in investment grade credit markets and high yield, and push spreads wider and prices low...
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