NGGBF UCITS Monthly - March 2017

• Positive month for bonds; Fund’s QAEUR hedged class gained 0.36%
• Fed increased rates 25 bps in a widely expected move
• 10 year Treasury yield unchanged over the month and credit markets well supported
• US dollar retraced some of the previous month’s gains; Fund retains US dollar exposure

The 25 bps Fed rate hike was so clearly flagged to the market that it ended up being a non-event, although the market drew some comfort from a perceived dovish tone to the FOMC minutes and Janet Yellen’s comments which talked of near-term risks as being ‘roughly balanced’. On the back of this, the 10 year US Treasury yield was unchanged at 2.39%. The failure of Donald Trump to get his Health Care Act passed on the first attempt highlighted the gap between campaign rhetoric and what is likely to get approved by Congress. Clearly, tax reform and deregulation were also major election promises and will be keenly watched to see what can actually be implemented.

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