FP Carmignac Global Bond

In the US, the labour market continues to show strength, with the unemployment rate falling to 4.0%. At the same time, inflation has risen to 3.0% year-on-year.

Politically, Trump has begun to implement his programme, starting with an increase in tariffs on Mexico, Canada, China and Europe, which is expected to come into effect in the coming months.

Talks on a ceasefire in Ukraine have also begun, with Trump engaging in negotiations with Russia for the first time since the war began in 2022.

In the eurozone, inflation rose in January on the back of higher energy prices, while core inflation remained stable at 2.7%. Growth momentum improved slightly, with Q4 GDP revised up to 0.0% and the composite PMI rising to 50.3 thanks to a recovery in the manufacturing component.

Interest rates fell in February, particularly in the US, where the 10-year rate fell by -33 bp thanks to Donald Trump's announcements and leading indicators pointing to a slowdown, while the German 10-year rate fell more moderately by -5 bp.

On the currency front, the US dollar continued its lull in February, which had begun at the start of the year, against a backdrop of moderation in American exceptionalism. This situation benefited the Japanese yen and the euro, which was also supported by a potential ceasefire in Ukraine.

Over the month, the fund delivered a positive performance, slightly below that of its reference indicator.

On the interest rate side, our long US rates, our inflation strategies and our short Japanese rates were the main contributors over the month. In addition, our exposure to certain emerging market debt, particularly that of certain Eastern European countries, had a positive impact.

Our credit exposure made a positive contribution, mainly due to our exposure to financial institutions, the energy sector and our selection of emerging countries in hard currencies. On the other hand, our positions on Argentine debt and the protections we put in place to reduce our exposure to this market had a negative impact.

Finally, on the currency front, we benefited from our exposure to certain emerging market currencies such as the Chilean peso, our selection of Eastern European and Central Asian currencies (Polish zloty, Hungarian forint and Kazakhstani tenge) as well as our long positions on the Japanese yen. Conversely, the portfolio was impacted by its exposure to the US dollar, the pound sterling and the Chinese yuan.

In a context of resilient global growth and gradually declining inflation, we expect the major developed and emerging market central banks to gradually continue their monetary easing. As a result, we are keeping modified duration at a relatively high level.

As regards interest rates, we prefer real rates in the United States, where economic data over the past month has pointed to a slowdown. We are also focusing on central banks that are behind the cycle, such as the UK, but also on certain emerging markets, such as Brazil, which is also benefiting from high real rates, and certain Eastern European countries that will be impacted by a possible ceasefire in Ukraine. We are also short Japanese rates, where inflation is starting to take hold, as well as in Europe, in a context of high defence spending.

On credit, we maintain our positive but cautious stance on the back of high valuations and maintain a significant level of hedging on the iTraxx Xover to protect the portfolio from the risk of spread widening.

In emerging market debt, our selection remains diversified and we continue to favour special situations in countries whose economies are being restructured or are showing significant improvement.

Finally, in terms of currencies, we now have a moderate exposure to the US dollar and maintain limited exposure to emerging market currencies. However, we are diversifying our exposure to the currencies of less accommodative central banks as the Fed continues to normalise monetary policy and China implements stimulus measures: the Japanese yen, a selection of Latin American currencies (BRL, MXN, CLP), Eastern European and Central Asian countries (PLN, KZT) and a short position on the renminbi.