Expectations of inflation and financial costs are causing interest rates to rise, causing a loss in fixed income
Fund A, the most conservative of the AFP multifamily funds over the past week, has dropped sharply.
According to the data obtained from the Study Center, the Chilean Chamber of Construction has two negative results for all multinational funds – two – AFP Habitat Controller – Seeds, in February. The most dangerous, calculated A and B, recorded residual seeds of -0.54% and -0.51%, while C, representing a difference of -1.05%. For their part, the most conservative fund achieves -1.46% on D and -1.19% on AI.
“Although all the mutual funds show a strong fall from the middle of February, the real drawback from Fund A’s special case was February 16-23, February 16-26, February 16th,” Creed said.
“Fund A has declined in the last few days, especially given the fact that its investment is in fixed income, an asset whose value has declined significantly over the past few weeks, which explains the rise in interest rates. D. locally and globally, “Sebastien Zarra, Manager of Tanner Investigation Markets”.
Chile’s fixed income represents 85% of Fund A’s portfolio, amounting to US $ 35.685.82 million.
From the CIDS they believe that “the profits of the highly conservative fund are explained by the results of investing in D&A – especially local debt security.” This is because “the prices of national fixed income instruments are falling, probably due to rising interest rates, rising rates of inflationary pressures, high financial costs and political uncertainty.”
If these expectations are met, prices can rise, negatively impacting fixed-income tools, which could happen on some global levels.
The interest rate on a 10-year Treasury bond in the US rose to a one-year high yesterday, reaching 1.46 percent. Zarra points out that the country is not oblivious to the global situation “In the case of Chile, the increase in reference interest rates has been about 50 basis points.