Investment-Grade Bonds Rebound in Q2 Amid Rising Inflation Pressures

U.S. investment-grade bonds rebounded in Q2 after declining slightly in the first quarter, delivering a modest second-quarter gain.

The annual core personal consumption expenditures rate edged higher from 3.3% in March to 3.4% in May, indicating rising inflation pressures.

All broad investment-grade bond sectors logged a second-quarter gain, with out-of-benchmark holdings and inflation swaps driving the portfolio's outperformance.

The fund's overall yield curve strategy contributed to relative results, particularly due to positioning in the U.K., New Zealand, and Canada.