Chief Investment Officer Bernard Swords discusses the rise in bond yields, with focus on the Fed and Central Banks not changing policy. Bernard also shares the outlook for client portfolios, focusing on the fixed income market. 

• Turbulent week in the fixed income markets last week with bond yields climbing up as US investors feel the pressure of the scale of the US fiscal package. We have also seen the Fed and central banks not changing policy and maintaining the same level until year end. ECB council members weighed in on accelerating their QE purchases, which resulted in panic in the fixed income markets.
• The equity markets felt pressure due to higher bond yields, with investors switching to cyclical growth sectors such as industrials, chemicals and commodities. However, with stability in the bond markets, we will see some of these trends reversing.
• In relation to client portfolios we are focusing on the fixed income market, as we have seen bond yields rise in the US, and the spread between US yields and Euro area yields widening out.