Federated Hermes CIO Says It’s Too Early for Aggressive Bond Buying, Favors Short-Term Debt
JH Kim
Summary
- Federated Hermes’ CIO said it is still too early to buy bonds aggressively despite elevated U.S. Treasury yields, as interest-rate volatility remains high.
- He said additional selling in bond funds could push Treasury yields higher before the market stabilizes.
- He added that he currently favors a short-duration strategy in bond investing and that mortgage-backed securities (MBS) could become attractive if interest-rate volatility eases.
Forecast Trend Report by Period
With U.S. Treasury yields near their highest levels in decades, Federated Hermes Chief Investment Officer R.J. Gallo said it is still too early to buy bonds aggressively because interest-rate volatility remains elevated.
Walter Bloomberg reported on October 30 that additional selling from bond funds could push Treasury yields higher before the market stabilizes, Gallo said.
For now, he prefers keeping duration short in bond investing.
Gallo added that mortgage-backed securities, or MBS, could become attractive once interest-rate volatility eases.
JH Kim
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