Goldman Sachs Asset Management’s Ashish Shah, global chief investment officer of public investing, added, “After more than a decade of low rates, widespread investor sentiment that there is no alternative to equities finally has turned. There are reasonable alternatives, such as core fixed income, including high-quality government bonds.
“Fixed income is experiencing greater inflows than equities in the U.S,” he said. “History suggests this will continue, as bond flows tend to pick up after a (rate) hiking cycle ends. Private credit should be a bright spot.”
The favorable attitude towards bonds in the near future was further re-enforced by Grecsek.
“We liked bonds at the beginning of the year and like them even more now. We haven’t seen real yields this high in some time so for those investors that have been avoiding bonds—now is a great time to buy,” he advised. “With inflation continuing to gradually fall, that should keep a lid on interest rates, which in turn should support broader bond and equity performance.”