Australia Is New Bond Market Favorite for JPMorgan Asset Management
- RBA has stymied performance of Aussie bonds by holding rates
- That will change as markets now see RBA joining in rate cuts
The Reserve Bank of Australia headquarters in Sydney.
Photographer: Brendon Thorne/Bloomberg
The great run in European government bonds is coming to an end, according to a portfolio manager at J.P. Morgan Asset Management, who is now betting Australia will be the next market to outperform.
Kim Crawford said there is little room for further gains in Europe compared to peers given swap markets are fairly pricing the amount of interest-rate cuts the European Central Bank will likely deliver. Meanwhile, a dovish pivot from the Reserve Bank of Australia — which has yet to lower borrowing costs in this cycle — is setting up Aussie debt for a rally relative to other developed markets.