Bloomberg Surveillance · Monday, August 31, 2026
Tracy McMillian advises staying at the short end of the bond curve to avoid inflation risk, noting that credit spreads are narrow, limiting incremental gains from credit risk. She believes investment-grade credit is a good way to gain additional income, as it offers attractive yields by historical standards for income investors.
“It is a nice living for a lot of income investors that have really suffered over the last couple of decades. And they're finally starting to see yields that are relatively attractive by historical standards.”
“In terms of taking credit risk, the credit spreads are still very narrow. So there's not a lot of incremental gain that investors can get from that credit risk. But, you know, we think that investment grade credit is a perfectly good way to gain some additional income.”
“And we'd stay at the short end of the curve because we're not interested in taking that inflation risk at the longer end.”