investments, currency, economy, finance
This year be will see rates low in the bonds of the treasure American of 10 years? Yes. The scenario of low growth and inflation and greater global liquidity is generally favorable for the sovereign bonds of developed countries.
German executioner, Credicorp Capital Colombia analyst analyzes fixed income in foreign markets to determine that panorama will be presented this year in international markets, mainly in the North American.
The scenario of low growth and inflation and greater global liquidity is generally favorable for the sovereign bonds of developed countries.
However, Credicorp believes that (i) the good performance of the labour market and economic activity in the United States, despite the fall in inflation, together with (ii) expectations the beginning of normalization of monetary policy, are sufficient factors to rate the Treasury bond American at 10 years at the level of 2.35% at the end of the year.
In that sense, the firm maintained its recommendation to the inside of the fixed income favour speculative debt in the United States against sovereign.
In U.S. economic activity looks solid and expectations point to a growth of 2.4% and 3.2% y/y for 2014 and 2015, respectively, when in 2013 the growth was 2.2% year-to-year.
In addition, job creation has allowed that the unemployment rate drops to 5.6%. However, the labour market seems to present still some lags, once demand has not been enough to push wages upward.
Similarly, inflation in the United States faces risks down product of the low prices of the commodities (particularly oil) and an expansion of liquidity in Europe that has strengthened the value of the dollar.
It previous has affected them expectations of inflation implied in them prices of market both of short as of long term, while is expected that the prices of the petroleum is stabilize and them effects in them expectations of inflation are transient.
This has sown doubts about inflationary pressures in the United States, even taking into account the good behavior of the economic activity, so the Fed has maintained a more lax monetary policy language of what was expected
On the other hand, the greater injection of liquidity in Europe and Asia along with the risks of deflation and low growth, have led to rates of sovereign bonds of developed countries in those regions to historically low levels. This has increased the relative value of American Treasury bonds, which have the highest performance among comparable peers.
Thus, the expectation of inflation and low growth world (the IMF slashed this week at 0.3% estimate of global growth for 2015 and 2016 to 3.5% and 3.7%, respectively), along with lower rates in sovereign bonds of developed countries and the fall in inflation expectations has allowed that the downtrend in the Treasury rate is maintained and accumulate a fall of 108 basis points in the past year.
This fall in the Treasury rate has been accompanied by a reduction in the market for the level of rate expectations 12 months later, about 55 basis points during the same period and is located at the level of 2.93%.