Slowing Inflation Sparks Hope for Battered Corporate Bond Market
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Slowing inflation has sparked hopes of a turnaround for hard-hit corporate bonds, with prices plunging in the past year.
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Longer-duration, low-coupon corporate bonds have been worst hit as Fed hikes made them less valuable.
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A hypothetical corporate bond portfolio has dropped from $1 million to $650,000 since early 2022.
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Analysts think bond prices will likely rise over the next 12 months with inflation slowing.
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Investors can look for discounts in battered bonds that may rally, while rebalancing portfolios.