Uncertainty remains elevated for the economy, inflation, monetary policy, and the path of the pandemic as the final quarter of 2021 approaches. As investors struggle to get a handle on how the final run of 2021 plays out, the US bond market has delivered a mixed performance year to date, based on a set of ETFs through Sep. 3.
Several narratives are roiling expectations. On the one hand, the risk of slower growth and disinflation continues to churn, driven by a rebound in the pandemic, the fading of federal stimulus support, and other factors. Meantime, investors worry that the recent jump in inflation will persist — an outlook that the Federal Reserve says is a low-risk event.
