JP Morgan Asset Management: "Falling energy prices are a boon for bonds... pay attention to European government bonds"

JPMorgan Asset Management said falling energy prices are improving the appeal of bonds by easing inflation pressure, with European government debt seen benefiting more than U.S. Treasuries given its greater sensitivity to energy costs. In a Nov. 5 Bloomberg interview, bond specialist Ian Steely identified lower oil prices as a key driver of falling bond yields and said current elevated rate levels offer meaningful value for holders and duration exposure. He also cited limited scope for further fiscal deterioration and the AI sector as supportive factors for bond markets. The view matters because it signals that energy-driven disinflation could extend the rally in duration-sensitive debt, with European government bonds the key market to watch.