FICC

Markets are increasingly pricing an end to the global easing cycle, with many central banks expected to remain on hold. But uncertainty remains high, and policy surprises are likely going into 2026. This Strategy Report breaks down the current drivers behind G10 central bank policies, and how to position for the next moves across FX and fixed income.

The Fed cut rates today, but a follow-up rate cut in December is uncertain. It will depend, in large part, on who wins a debate about the neutral rate of interest.

US inflation data continue to show no signs of price pressures beyond a near-term tariff effect.

The Fed is poised to deliver a 25-basis-point rate cut this month, but a follow-up rate cut in December will depend on how the divergence between strong consumer spending and weak employment growth is resolved.

Same policy rate, very different expectations. We break down why policy convergence between the Fed and BoE is THE fixed income trade for year-end.

Special Report

This week’s Special Report evaluates the reward and risk in corporate bonds. We address the question of whether low expected excess returns today are justified by low risk or an example of overvaluation.

Treasury yields are generally following the pattern of past interest rate cycles, but with a larger term premium keeping the curve steeper than usual.

Despite concerns about fiscal sustainability, a rise in term premia, and attacks on central bank independence, monetary policy remains the primary driver of bond markets. In our Q3 Review & Outlook, we update our views and identify opportunities in government bonds, short-term interest rate futures, global yield curves, inflation-linked bonds, and credit.

Our Portfolio Allocation Summary for October 2025.

Monetary policy divergences are re-emerging. We rely on BCA’s Central Bank Monitor to assess the current policy stance of major central banks, and highlight the tactical opportunities across bond markets and currencies.