PineBridge Investments: Prefer short-term fixed income assets amid inflation risks

Golden Ten Data reported on June 25 that Vincent Chung of PineBridge Investments stated that as global manufacturing activity recovers and raw material costs continue to rise, the market may be underestimating the risk of more persistent inflation. The co-portfolio manager pointed out in a report: “Although investors still expect productivity gains driven by artificial intelligence to offset the impact of inflationary pressures, these benefits may take time to materialize.” Meanwhile, the market could experience a period of volatility as it reassesses the outlook for growth, inflation, and interest rates. In this environment, he prefers to allocate to fixed income assets with shorter durations, including high-quality global high-yield bonds and some emerging market credit. He added that inflation-linked bonds can also serve as an important tool for portfolio diversification.