Invesco
May 10, 2026
Global Fixed Income Strategy
Macro ThematicRates Govt BondsFXCommoditiesEnergyMaterials
Invesco's May 2026 strategy report projects a 'higher for longer' Fed stance due to sticky inflation while warning that markets are ignoring severe supply chain disruptions caused by the Iran conflict.
Key Takeaways
- 1.The Fed is expected to remain on hold in 2026 due to sticky core inflation around 3% and resilient growth near potential.
- 2.Markets are likely underestimating the second-order shocks of the Iran conflict, particularly regarding refinery outages and supply chain disruptions in non-oil commodities.
- 3.Global supply of critical inputs like fertilizers, pharmaceuticals, and helium for semiconductors is severely threatened by the Gulf conflict.
Table of Contents
- Global macro strategy
- Global credit strategy
- Rates and currency outlook
- The bottom line
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Authors
Turgut KisinbayRob WaldnerMark Paris
Securities
JGBBloomberg Municipal Bond IndexCrude Oil
Themes
Second-Order Geopolitical ImpactsMonetary Policy Inertia
Regions
Middle EastNorth AmericaEuropeUnited StatesAustraliaJapan
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