Asks PIMCO to explain why they stood firm on US Treasuries in April/May when others were bailing on US assets.
Romaine Bostick
Mohit Mittal
Our view was that tariff-related uncertainty would add to challenges for consumers and businesses, leading to a growth slowdown in summer, which would be beneficial to Treasuries.
Asks about internal discussions with colleagues versus client concerns.
Romaine Bostick
Mohit Mittal
Discussions centered around the trade-off between inflation impact and growth slowdown impact from tariffs. Clients had concerns about US policy, but we were not seeing meaningful shifts in near-term data.
Asks if there was a historical analogue for the tariff moment or if it was new ground.
David Gura
Mohit Mittal
There's always something new. Pre-April, US tariff rate was ~2%, we thought it would go to ~10%, but announced tariffs were closer to 20% weighted average. We thought it would settle in 15-18% range.
Asks how much they're paring bets on US debt and what other countries offer opportunity.
David Gura
Mohit Mittal
We have reduced some of our duration exposures in the US because US Treasury market has been the biggest outperformer relative to other developed market rates.
Asks for general outlook for volatility in 2026.
Romaine Bostick
Mohit Mittal
Volatility is here to stay. You have a lot of competing forces: positive effect from fiscal stimulus (One Big Beautiful Bill) in Q1, tariff uncertainty, AI capex that may or may not materialize as expected.