Corporate bonds shine as investor appetite for risk grows.
Investor appetite for bonds was strong across the board, as all sectors clocked in positive returns for the month. The two-month Treasury rally reflects the sentiments shown in the probability the market is giving that the Federal Reserve will raise rates in the near future. Most yields across the global markets fell last month as the strong rally in equities markets seems to be petering out. The Morningstar Treasury Index rose 0.92% in August, and the broad-based Morningstar US Core Bond Index rose 0.7%.
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Sanjay Arya is director of Morningstar Indexes.