It may be worth considering advisers considering using inflation-linked bonds in portfolios again as a hedge against inflation, according to AXA Investment Managers (AXA IM).
Chris Iggo, chief investment officer for core investments at AXA IM, said many had been hoping for a lower inflation print in the US but was not necessarily going to play out.
According to the US Bureau of Labour Statistics, CPI inflation rose 0.4 per cent in March 2024, the same as February. This measures the change in prices paid by consumers for goods and services and put the 12-month inflation rate at 3.5 per cent.
With this in mind, Iggo recommended his chosen asset class for fixed income is inflation-linked bonds.
“It is prudent to reduce expectations of significantly lower inflation or rates for the rest of this year.
“The market has punished long duration trades on many occasions in recent years and it is doing so again. It is unlikely to be a…
