Bloomberg Surveillance · Tuesday, September 8, 2026
Oksana Aronov, Head of Market Strategy for Alternative Fixed Income at J.P. Morgan Asset Management, suggests that the front end of the curve, particularly two-year Treasuries yielding nearly 4.4%, offers attractive risk-adjusted returns. She notes that these returns are comparable to or better than riskier high-yield options, with significantly less volatility.
“So that just tells you the fact that the very front of the curve, three-month T-bills are pretty much where high yield, the riskiest part of the bond market is, tells you that the market is kind of like a coiled spring in credit, meaning spreads are so very tight that everything is moving off of interest rate risk, which has not really been the friend of bonds this year as yields have moved up.”
“I'm excited about twos at 4.37. I mean, why not? That's above the Fed funds. We're likely not going to see a meaningful hiking cycle even if we get a hike or two here, which the bar for that even is fairly high. So sitting there at nearly 4.4 in the two-year is a great.”