Carmignac Portfolio Global Bond

The US Federal Reserve delivered a more dovish message than expected at its September meeting, cutting its key rate by -0.5%.

Growth data nevertheless exceeded expectations across the Atlantic, both in terms of unemployment, which declined to 4.2%, and consumer resilience, with retail sales accelerating by +0.1%.

Headline inflation continued to slow to +2.5% year-on-year on the back of falling commodity prices, while core inflation remained stable at +3.2%.

For its part, the European Central Bank cut its key rate by -25bp against a backdrop of disappointing economic data, both in terms of leading indicators and the zone's future growth prospects.

Among other central banks, the Bank of Japan opted for a pause in its rate hike cycle, while the Brazilian central bank raised its key rate by a quarter point.

At the end of the period, the Chinese authorities announced a series of measures aimed at curbing the slowdown in the Chinese economy and boosting market sentiment.

On the currency front, the weakness of the US dollar benefited emerging currencies, which appreciated over the month, particularly Latin American and Asian currencies.

The Fund recorded a positive performance, outperforming its reference indicator over the period.

With interest rates easing across the board and risky assets performing well, the Fund's main drivers made a positive contribution to performance.

On the rates side, our long positions in US and European rates had a positive impact, while our inflation strategies and our long position in Canadian rates had a negative impact.

On the credit side, our exposure to developed markets, particularly in the financial sector, and our investments in the external debt of emerging countries made a positive contribution, slightly offset by our hedges on the credit markets.

Finally, in terms of currencies, our exposure to the US dollar, sterling, the Brazilian real and the Chilean peso had a positive impact, while the Japanese yen detracted slightly from performance.

Against this backdrop of a soft landing for the economies and inflation continuing its gradual decline, we are maintaining a relatively high level of modified duration.

In terms of rates, we favour real rates in the United States and steepening strategies in the United States and Europe. We are also focusing on central banks that are lagging the cycle, such as the UK, and on certain emerging countries, such as Brazil and Mexico.

On the credit front, we are maintaining our cautious bias due to high valuations and are maintaining a substantial level of hedging on the Itraxx Xover to protect the portfolio from the risk of widening spreads.

On the external EM debt front, we continue to favour special situations in countries whose economies are undergoing restructuring or improving significantly.

Finally, we remain cautious on the currency front, with particularly low exposure to the USD and EM currencies. However, we do have diversified exposure to the currencies of central banks that are taking a less accommodative stance against a backdrop of monetary easing by the Fed and Chinese stimulus measures, such as the Norwegian krone, the Australian dollar, the Japanese yen and the Brazilian real.