Global Fixed Income Views

J.P. Morgan Asset Management has increased its 2026 economic expansion outlook to 80%, driven by resilient AI-related capital expenditure and lower energy prices. The firm recommends positioning portfolios for yield and carry in fixed income, specifically through bank credit and emerging market debt.

Key Takeaways

• 1.Raised expansion probability to 80% due to resilient economy and AI-driven capex cycle.
• 2.Fed is expected to hold rates at 3.625% for the remainder of 2026, targeting a 10-year Treasury range of 4.25%-4.625%.
• 3.Portfolio strategy focuses on yield and carry via bank hybrids, contingent convertibles, bank loans, and emerging market debt.

Table of Contents

• Macro backdrop
• Scenario expectations
• Risks
• Strategy Implications
• Closing thoughts

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