Looking ahead to Q3 2023: A recession on the horizon

With the likelihood of a recession growing, the landscape for fixed income investors is shifting as we enter the third quarter of 2023.

After raising policy rates 500 basis points (bps) over sixteen months, the end of the Federal Reserve’s hiking cycle is now within sight, shifting duration from a headwind to a tailwind.
The forward-looking trend for global policymakers in aggregate has become clearer, with fewer hiking more, more hiking less, and some not hiking at all.
With several historically reliable economic indicators signaling that a recession is on the horizon, the stage is set for fixed income to perform well; particularly, high-quality assets.

With public and private market capabilities across all asset classes, Principal Asset Management^SM and its specialist investment teams are focused on harnessing the potential of every opportunity to secure an advantage for its clients.

The 23rd largest manager of worldwide institutional assets, Principal Asset Management applies local insights with global perspectives to identify compelling investment opportunities and deliver distinctive solutions aligned with client objectives.¹

Principal Asset Management is the global investment management business for Principal Financial Group® (Nasdaq: PFG), managing $501.5 billion in assets and recognized as a Top 10 “Best Places to Work in Money Management” for 11 consecutive years.^2,3

¹ Managers ranked by total worldwide institutional assets as of 31 December 2021. Pensions & Investments, “Largest Money Managers,” December 2021.
² Principal Asset Management AUM as of December 31, 2022.
³ Pensions & Investments, “Best Places to Work in Money Management” among companies with 1,000 or more employees, December 2022.
Principal Asset ManagementSM is a trade name of Principal Global Investors, LLC.