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Ostrum takes part in AGEFI roundtable on long-term rates

20.07.2018

French financial weekly L’AGEFI Hebdo recently welcomed Brigitte Le Bris, Head of Global Interest Rates & Currency at Ostrum Asset Management, for one of its traditional roundtable discussions, along with four other portfolio managers. The discussion featured in the Les invités – TABLE RONDE supplement published with the July 19-25, 2018 AGEFI Hebdo on the theme of Une collision entre haut de cycle et protectionnisme ("When cycle peak and protectionism collide" - in French only).

During the roundtable discussion, Brigitte Le Bris outlined her view of forthcoming long-term interest rate trends. In her opinion, projections of two rate hikes from the Fed in 2018, followed by two or three in 2019 do not necessarily apply to long-term rates, stating that valuations carried by the Fed’s balance sheet should restrict the rise in long-term rates and expecting steepening of the yield curve in light of the current robust state of the US economy, which could deteriorate from 2020 onwards.

Brigitte Le Bris also highlighted that the US’ current anti-liberal ideology rejects the reality of free trade, which is a growth driver, and practical application of this approach could have serious consequences, drawing a parallel with the George W. Bush administration, which had a contractionary effect on interest rates. She also warns of the potential risk of ending up in this situation on both sides of the Atlantic. Meanwhile, she recommends looking to bond asset classes with higher carry (in Europe, high yield), with a particular focus on emerging markets.

Click here to read the AGEFI Hebdo supplement (in French only)

Watch Brigitte Le Bris video interview (in French only)

On 3 April 2018, Natixis Asset Management became Ostrum Asset Management.