Global Fixed Income Strategy Monthly Report
In our regularly updated macroeconomic analysis we offer an outlook for interest rates and currencies – and look at which fixed income assets are favoured across a range of market environments.
Fixed income
Capitalise on investment grade thinking
Find out what investment grade corporate bonds can bring to your portfolio. Explore the latest outlook, themes and trends in the asset class, and discover how Invesco can help.
$78 billion
We manage $78 billion in global investment grade credit assets.1
18 years
Our portfolio managers average 18 years of experience1
180 team members
Our experience fixed income team is made up of 180 investment professionals across the globe.1
2024 LSEG Lipper Fund Award - Best Fixed Income Group
Recognised among large U.S. investment managers by LSEG Lipper for outstanding performance.2
Investment grade portfolios built on collaboration
We bring the vast resources of a global asset manager while remaining agile enough to potentially add value through security selection. Dive into our breadth of active, passive, and environmental, social and governance solutions.
Credit’s credentials
We know that you’re busy, and conducting thorough investment research takes time. So, to help make your life easier, we’ve highlighted seven key datapoints we think you should be watching.
Download our first edition of “Credit’s Credentials”, a fixed income infographic, to get the inside scoop on bond markets at a single glance.
Our investment grade credit mutual funds
Our investment grade credit ETFs
BulletShares UCITS ETFs
Investment risks
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The value of investments and any income will fluctuate (this may partly be the result of exchange rate fluctuations) and investors may not get back the full amount invested. Debt instruments are exposed to credit risk, which is the ability of the borrower to repay the interest and capital on the redemption date.
What can investment grade credit bring to your portfolio?
Reliable income generators
Investment grade corporate bonds can play an important role as income generators in investor portfolios.
This made them popular with investors in the years following the global financial crisis, when the world lived through a sustained period of ultra-low yields.
Transcript
Related insights
Learn more about the opportunities we see in today’s market.
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Fixed Income 
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Fixed Income 
The future of fixed income investing; takeaways from our webinar
As we enter the final quarter of the year, our experts look back at the ‘year of the bond market’ and share their thoughts on the outlook for Fixed Income assets going forward.
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Fixed Income 
Monthly fixed income update
August was another positive month for fixed income markets, with Fed Chairman Powell largely confirming that US rates would be cut in September. Read our latest thoughts on how fixed income markets performed during the month and what we think you should be looking out for in the near term.
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Alternatives 
Yields remain attractive and may maintain positive relative value
Significant focus on the uncertainty of the US macroeconomic backdrop and its potential implications on the market remain top of mind for investment opportunities. Against this cautious outlook, we asked the experts from Invesco’s bank loan, direct lending and distressed credit teams to share their views as the third quarter of 2024 wraps up.
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ESG 
Impact investing: climate adaptation and transition in a changing world
If we are to live more sustainably by 2030, the Climate Policy Initiative estimates that US $4.3 trillion will be needed annually. Climate adaptation and transition projects are helping, but more finance is needed. Find out more.
Frequently asked questions
Investment grade credit are bonds or other fixed-income securities rated at a certain level of creditworthiness by rating agencies. These securities are considered to have a lower risk of default compared to non-investment grade (also known as “high yield” or “junk”) bonds. The ratings for investment grade credit typically range from BBB- or Baa3 (low) to AAA or Aaa (high).
Investment grade bonds are rated by credit rating agencies like Standard & Poor’s (S&P), Moody's, and Fitch. The ratings are based on the issuer’s financial health, historical performance, and overall economic environment. Ratings range from AAA (highest quality, lowest risk) to BBB- (lower quality, higher risk but still considered investment grade). For example:
AAA/Aaa: Highest credit quality, minimal risk.
AA/Aa: High credit quality, very low risk.
A: Strong credit quality, low risk.
BBB/Baa: Adequate credit quality, moderate risk, but still investment grade.
The credit rating on a bond will be associated with the premium or “spread” demanded for holding it: the higher the risk, the more issuers will have to pay investors.
Bond prices in general work inversely to interest rates. So, when interest rates rise, the price of existing bonds typically falls. When interest rates fall, the price of existing bonds usually increases. The extent of the price change will depend on several factors including the time to maturity of the bond, its coupon level and frequency. The sensitivity to interest rate changes can be worked out mathematically and is known as “duration”. Bonds with longer maturities and lower coupons, which are more frequently found in investment grade, are more sensitive to interest rate changes, something investors should be aware of. But corporate and other investment grade bonds will generally have a lower interest rate sensitivity than equivalent government bonds, thanks to the additional credit premium in the coupon.
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Footnotes
1. As of December 31, 2023
2. Source: LSEG Lipper Fund Awards. © 2024 LSEG Lipper. All The LSEG Lipper Fund Awards, granted annually, highlight funds and fund companies that have excelled in delivering consistently strong risk-adjusted performance relative to their peers. The LSEG Lipper Fund Awards are based on the Lipper Leader for Consistent Return rating, which is an objective, quantitative, risk-adjusted performance measure calculated over 36, 60 and 120 months. The fund with the highest Lipper Leader for Consistent Return (Effective Return) value in each eligible classification wins the LSEG Lipper Fund Award. For more information, see lipperfundawards.com. Although LSEG Lipper makes reasonable efforts to ensure the accuracy and reliability of the data used to calculate the awards, their accuracy is not guaranteed. LSEG Lipper Inc. is a major independent mutual fund tracking organization.
Investment risks
The value of investments and any income will fluctuate (this may partly be the result of exchange rate fluctuations) and investors may not get back the full amount invested.
Important information
Views and opinions are based on current market conditions and are subject to change.
This is marketing material and not financial advice. It is not intended as a recommendation to buy or sell any particular asset class, security or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication.
EMEA 3631472/2024
