The Economic Times·2026-02-20 00:42Group 1 - Yields on US government debt are near their lowest levels in months due to haven demand amid stock-market volatility and a tame January inflation reading, suggesting investor expectations for potential rate cuts later this year if labor-market weakness is observed [1][9] - Invesco, Carmignac, and BNP Paribas do not share the outlook of further rate cuts, citing strong economic data, including January job growth exceeding projections and significant corporate investments in artificial intelligence [2][9] - The Federal Reserve's recent meeting minutes indicate a cautious stance on rate cuts, with some policymakers suggesting that rate hikes may be necessary if inflation remains above the 2% target [2][9] Group 2 - Macro strategists at TS Lombard recommend betting on fewer rate reductions in the second half of 2026, while Invesco's fixed-income chief strategist anticipates one rate cut this year, though the likelihood of no cuts is increasing due to robust economic data [3][6] - Carmignac's co-head of fixed income, Guillaume Rigeade, is short US Treasuries and predicts the 10-year yield could rise to 4.5% in the coming months, up from approximately 4.1% [7][9] - Recent economic data presents mixed signals, with a headline annual consumer inflation figure of 2.4% indicating cooling, yet services prices have accelerated, creating a complex environment for bond investors [8][9]