Skip to Content
Fund Spy

Bond Funds Endure a Year of Economic Anxiety

Bond markets grappled with monetary policy and political unknowns in 2018.

Mentioned: , , , , , ,

Following two years of risk-on market fervor, 2018 delivered a reality check to bond investors. 

Even with new leadership, the Federal Reserve continued to raise short-term interest rates and simultaneously pared back its quantitative-easing-inflated balance sheet; both were efforts to normalize monetary policy while U.S. economic data appeared strong. A strengthening dollar, escalating U.S. trade-policy fears, and myriad geopolitical tensions further rattled markets at points throughout the year, which ended with a meager single-basis-point return for the Bloomberg Barclays U.S. Aggregate Bond Index. 

To view this article, become a Morningstar Basic member.

Register for Free

Emory Zink does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.