How to allocate in a painful Treasury market… | Ausbiz

Delve into the details of asset allocation strategy insight from Isaac Poole at Oreana Financial Services. With ongoing strength observed in the job-market, there’s some evident wage growth stirring concerns for both the Fed and investor. A cooling labor market mirrors predictions by the Fed, and may give some scope to pause with a prevailing hawkish bias. Significant shifts higher especially in long-ends cast a spotlight on the U.S. Treasury market last week.

Notice a surge in issuance from the US Treasury while yields back up to 4.2% for the 10-year graph. Investing in treasuries may require some intestinal fortitude, but short end of the curve offers attractive yields. Meanwhile, China, still facing a slow recovery after the recession, could see a shift from disinflation to outright deflation causing the authorities to intensify efforts to stimulate spending. As the U.S. prepares to release upcoming inflationary reads, careful watch and analysis will be necessary as potential rate cuts loom in the future.

(Source: Ausbiz)

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