Which bonds are currently attractive for investors

Frankfurt Interest-bearing securities bring income again. The central banks take care of that. By raising interest rates by 0.75 percentage points (75 basis points) on Thursday, the European Central Bank (ECB) made it clear that it intends to fight inflation even at the price of a recession.

The US Fed has tightened significantly earlier and is likely to tighten by 75 basis points next week.

Nevertheless, government bonds remain the “most hated asset class”, as Ariel Bezalel, head of bonds at Jupiter Asset Management in London, put it in an interview with the Handelsblatt. The reason is simple: if yields continue to rise, the corresponding fall in price will be even more, as old, lower-yielding paper becomes less attractive than newer ones.

Since the beginning of the year, bond investors have experienced a veritable sell-off several times. And although the markets are already anticipating the tightening of monetary policy, investors expect yields to continue rising.