A Rocky Road Ahead?

Baird Advisors Fixed Income Market and Economic Outlook: September 2019

Economic expansion in the United States continues. But how long can even low, slow growth persist in the face of global headwinds and changing demographics at home?

While delivering the team’s fixed income investment outlook at their annual Institutional Investors Conference, Baird Advisors Deputy CIO Warren Pierson stated, "we still say that an imminent recession is unlikely, but clearly the risks are rising .... The base case is that we will see a continuation of gradual growth in the U.S. economy, but with elevated risks and a wider range of potential outcomes."

The outlook calls for a continuation of the longest economic expansion in modern U.S. history, while highlighting a number of threats that could challenge that thesis.

Topics covered included: 

  • How the baby boomers and technology are keeping rates low
  • The impact of an inverted yield curve on fixed income investments
  • Negative interest rates
  • Why the U.S. economy isn’t as worried about trade tensions and a manufacturing slowdown as some companies are
  • Implications for the Fed in 2020

As the managers of Baird Funds’ fixed income offerings, Baird Advisors relies on a disciplined, risk controlled investment approach honed by the team’s leadership over more than 35 years of managing fixed income portfolios together.