Bond managers relaxed ahead of bumper index rebalance

Fed’s credit facilities boost confidence as downgrades hit corporate bond indexes

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Asset managers expect the bumper month-end rebalancing of corporate bond indexes on April 30 to pass without much fuss. And if it does, they’ll have the US Federal Reserve to thank for averting a fire sale.

The difference in liquidity conditions between now and March “really is like night and day”, says Neil Sutherland, a portfolio manager for US multi-sector fixed income at Schroders. “We’ve had pretty much unlimited intervention from the Fed and we’ve had a pretty significant recovery

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