By Sam Boughedda
A senior investment executive at T. Rowe Price Group said investors should buy bonds now.
T.Rowe, which manages $1.4 trillion in assets, said bonds are at their “most attractive point” in years.
Arif Hussain, head of international fixed income and chief investment officer of T. Rowe, said bond yields will continue to climb over the medium term, reaching levels that offer attractive income opportunities for knowledgeable investors.
In the company’s semi-annual market outlook, Husain wrote that investors may want to consider adding duration in the coming quarters.
He added that high-yield corporate bonds can already be a bargain, and some BB-rated bonds are priced at levels that are “historically good buying points.”
“The threat of a recession is real,” Husain wrote.
Husain believes that US dollar-denominated emerging market bonds are particularly attractive, and that the Fed will continue to tighten rates until it forces Federal Funds rates into positive territory in post-inflation terms.