Macro Matters: Insight Investment’s Murphy on Fixed Income

The angst, consternation and hand-wringing over debt levels may be a contrarian indicator that rate markets are oversold, says Brendan Murphy, North American head of fixed income at Insight Investment Management. Murphy joins Bloomberg Intelligence chief US interest rate strategist Ira Jersey on this Macro Matters edition of the FICC Focus podcast to discuss the outlook for fixed income. Murphy attributes elevated yields to a stronger macro backdrop, persistent inflation uncertainty, the Fed leadership shift to Chair Kevin Warsh and fiscal concerns amplified by heavy AI-driven corporate issuance. He outlines Insight Investment’s base case that the Fed holds at its upcoming meeting, favors the five-year part of the curve and prefers non-agency securitized credit and agency mortgages over investment grade on valuation grounds. The episode closes with Murphy’s contrarian view that widespread market pessimism may signal a fixed-income buying opportunity, with high-quality portfolios now yielding around 6%, competitive with long-run equity return expectations. 

The Macro Matters podcast is part of BI’s FICC Focus series.