Bond funds sector review – more interest rate rises and long and variable lags

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Tax, investments and pension rules can change over time so the information below may not be current. This article was correct at the time of publishing, however, it may no longer reflect our views on this topic.

We look at the headlines gripping bond markets, share our outlook for bonds, and discuss how some of our Wealth Shortlist funds have fared.

This article isn’t personal advice. If you’re not sure whether an investment is right for you please seek advice. If you choose to invest the value of your investment will rise and fall, so you could get back less than you put in.

18 August 2023

Interest rates have continued to rise, with the US interest rate now at its highest level in 22 years. At the same time, inflation has fallen. All the while, the talk of central bankers is about long and variable lags.

So, what has this all meant for bonds?

This article isn’t personal advice. If you’re not sure whether an investment is right for you, please ask for financial advice. All investments and any income from them can fall as well as rise in value, so you could get back less than you invest. Past performance isn’t a guide to the future.

Interest rates and inflation have been key reasons behind the losses in bond markets over the last 18 months or so. The trend over the last three months has been no different, so where are we now?

Over the