PIMCO
The latest research and outlooks in the ProAllocate library
- Macro
Macro Signposts | Campaign Spending: The Hidden Boost Behind U.S. Consumer Resilience
PGIM argues that record 2026 midterm campaign spending, recorded as personal consumption expenditures, plus retroactive OBBBA tax refunds, masked the drag from a 40% rise in energy prices on U.S. consumption. With both tailwinds fading in 2027, consumer resilience will hinge on whether energy prices retreat.
- Macro
With Echoes of 1974, a Decisive Victory for the Democratic Party
Northern Trust's analysis argues the 2026 US midterms produced a historic Democratic sweep resembling 1974 more than 2006, driven by affordability concerns rather than a progressive mandate. It warns the biggest market risk is state-level data center restrictions threatening the AI buildout, not federal gridlock.
- Private Markets
Commercial Real Estate: A Reset, Not a Replay
Despite a REIT selloff driven by higher real yields, resilient CMBS and REIT bond spreads suggest commercial real estate faces a valuation reset rather than a repeat of 2023's credit-driven stress. Higher starting borrowing costs, stronger debt-service coverage, and stable (non-office) demand should limit the severity of the current adjustment.
- Fixed Income
Policy Options Are Available Now to Lower U.S. Mortgage Rates
PIMCO argues that Trump's housing executive order could raise mortgage rates if fee cuts apply to refinancings, not just new purchases, and outlines three policy levers that could instead lower rates by 65-90 basis points.
- Macro
U.K. Budget: Breathing Space, for Now
The UK Budget delivered smaller-than-expected fiscal tightening, leaving the deficit path and spending pressures largely deferred to next year's Spending Review. The piece argues gilt market sentiment hinges more on the deficit's trajectory and Bank of England policy than on precise fiscal headroom figures.
- Macro
Macro Signposts | Is AI Crowding Out the Rest of the Economy?
Goldman Sachs argues the AI investment boom is largely reallocating U.S. economic resources rather than adding to overall growth, as rising rates, credit spreads and import reliance shift the burden onto housing, small firms and labor income. The firm concludes reallocation will persist until AI delivers productivity gains that expand economic capacity.
- Macro
Macro Signposts | Fed Pauses as Rate Recalibration Continues
The Federal Reserve held rates steady in October after September's hike, with Chair Kevin Warsh signalling a pause to assess tightening rather than an end to it. The authors expect a December hike and possibly one more in early 2027, framing this as policy recalibration rather than a sustained hiking cycle.
- Fixed Income
What Should Investors Expect an Active Fixed Income Manager to Deliver?
PIMCO's Mohit Mittal argues active fixed income managers can exploit structural inefficiencies, thematic positioning and opportunistic dislocations across credit, global bonds and mortgages that passive index strategies and bond ladders cannot capture. He describes PIMCO's team-based research and scenario-driven portfolio construction process for generating diversified alpha.
- Fixed Income
The Credit Market Lens: The Other Side of Higher Yields
Higher bond yields have restored duration's role as both income source and equity hedge, but rising funding costs are exposing weak balance sheets unevenly across CCC credit, European sovereigns, AI debt issuers, and real estate.