Intro
Manpreet Gill, Chief Investment Officer for EMEA at Standard Chartered, takes host Hannah Chew through the bank's newly released Global Market Outlook: what has pushed long-dated US Treasury yields up, why he thinks inflation risk is receding rather than building, where the yield call puts duration and credit, which sectors and regions the equity overweights sit in, and the reinstated overweight on gold.
Guest: Manpreet Gill, Chief Investment Officer for EMEA, Standard Chartered
Host: Hannah Chew, portfolio strategist with the Standard Chartered CIO office
Published: 28 August 2026 on Standard Chartered Money Insights
Episode page | 11 min
Key Takeaways
Bond yields are more likely to move lower than higher from here
The 30-year yield is up around 40 to 50 basis points this year, and Gill puts as much of that on rising US national debt as on inflation
"inflation and therefore bond yields are more likely to move lower rather than higher from here"
Three to five years is where the bank wants its duration
"we would consider selectively adding to longer maturities should the 10-year yield spike temporarily above 4.75%"
Corporate and emerging market bonds stay preferred over G3 government debt, with US investment grade the one short-term exception
Hyperscaler issuance is creating excess supply pressure in investment grade
Equities stay overweight globally, and financials are the route to broadening the book
A steeper yield curve widens net interest margins, and financials are preferred across the US, Euro area and Japan
The dollar forecast is cut on both horizons after the Treasury doubled its buyback operations
"we have reduced our forecast for the US dollar index to 98 from what was 101.5 earlier"
Gold goes back to overweight on dollar weakness and a technical break higher
"we've also raised our three and 12-month price targets to 4,750 and 5,000 dollars respectively"
What Is Actually Pushing Long-Dated Treasury Yields Up
Chew opens on the bank's new house view: "We've just released our latest Global Market Outlook, and it does seem to have quite an emphasis on yields."
Her framing for the episode: signs of cooling inflation and a softer labor market "could suggest the yield pressures may be approaching a ceiling"
Gill's starting numbers: the US 30-year government bond yield has risen by around 40 to 50 basis points this year, which he says triggered a response from the US Treasury as it seeks to signal its desire to contain the rise
Inflation remains one of the more commonly cited drivers, but the rise has been disproportionately concentrated in longer maturities
That skew is why he reads it as a debt story: "we'd argue that at least some of the concerns are related to the continued rise in US national debt"
Two technical contributors sit on top of that — the relative absence of some key sovereign buyers, and significant hyperscaler bond issuance in the investment grade corporate market
Why Gill Thinks Inflation Risk Is Fading, Not Building
On the inflation question specifically: "we're relatively less concerned about inflation risk and indeed believe there's room for market worries to actually recede a bit"
Recent cooling in US inflation data and what he calls a lackluster job market data set point to less rather than more inflation risk ahead
Oil is the acknowledged risk to that view, and he holds it on the assumption that there is no significant new escalation in the Middle East conflict
Pulling it together: "inflation and therefore bond yields are more likely to move lower rather than higher from here"
That, he says, is consistent with the bank's continued expectation of a soft landing for the US economy
Where the Yield Call Puts Duration: Three to Five Years
Chew asks what the yield view means for bond portfolio positioning
Softening yields should be most pronounced in relatively shorter duration bonds, because the lack of renewed inflation fears eases concerns about Fed rate hikes
The effect fades as you go out the curve, particularly beyond 10 years, where easing Fed rate hike concerns are balanced against longer-term concerns about US debt levels
"we continue to see the 3-to-5-year duration as offering the most attractive risk reward"
He leaves a condition on going longer: "we would consider selectively adding to longer maturities should the 10-year yield spike temporarily above 4.75%"
Corporate and EM Bonds Over G3, With One Short-Term Exception
Within bonds, the relative preference for corporate and emerging market debt over G3 government bonds is unchanged
On valuation: credit spreads remain elevated, but Gill says credit fundamentals continue to justify those levels
The overweight itself is focused on emerging market US dollar government bonds, on fiscal fundamentals
Most corporate and EM bonds still qualify as attractive sources of yield in his framing
The exception, and he marks it as a short-term one, is US investment-grade bonds, which face excess supply pressure over that very short horizon from elevated hyperscaler debt supply
Why Capped Yields Are Good for Equities
Chew asks how the team is assessing what current yield levels do to equities
Easing short-maturity yields should be supportive for equities, on the condition that long-term yields stay capped
If they do, markets can go back to focusing on what Gill calls very strong earnings growth
The act of pricing out Fed rate expectations would be equally supportive on its own
That is the basis for the position: the bank remains overweight equities at a global level
Financials as the Route to Broadening Equity Exposure
Asked about sectors and regions, Gill leads with financials: "financials is one sector that we believe is an attractive route to broadening exposure"
The preference runs across the major regions — US, Euro area and Japan equities
The mechanism is the curve: financials are usually a direct beneficiary of a steeper yield curve, or a widening gap between long and short maturity bonds, and the benefit arrives through expanding net interest margins
He also likes the sector for the diversification it offers within an equity allocation
Technology and AI: Two Months of Underperformance He Expects to End
Broadening exposure does not mean stepping away from technology and AI, where Gill sees positive momentum continuing or resuming
The setup he is calling a turn on: two months of relative underperformance against value style sectors
Concerns about the magnitude of capital spending are likely to resurface from time to time
His reason for staying with the theme anyway: "we believe improving AI monetization indicators point to continued sector outperformance"
Regional Preferences: Overweight US and Asia ex-Japan
The bond yield view and the sector view together produce the regional calls
Overweight on US and Asia ex-Japan equities, with core holding views on Japan and Euro area equities
The AI theme benefits US and Asian equities more directly, which is what tilts the overweights that way
What the financials preference does for the other two: it should help drive performance across Japan and Euro area equities, particularly if their central banks raise rates further
He names the ECB and the Bank of Japan as the central banks in question, and says further increases are what the bank expects
The Dollar: 98 in Three Months, 96 in Twelve
On FX, Gill sees downside risk to the dollar: "we have reduced our forecast for the US dollar index to 98 from what was 101.5 earlier" on a three-month horizon
The trigger is a Treasury operation: the decision to double liquidity support buybacks in 10- to 30-year government bond debt from $2 billion to $4 billion per operation through early November
He reads that as aimed at capping long-term yields, and treats it as a new near-term headwind for the dollar
What the initial move told him: higher government bond yields may provide less reliable support for the dollar when the worries are driven more by fiscal concerns and the term premium than by stronger economic growth or core real yields
The labor market points the same way: nonfarm payrolls fell by 23,000, and wage growth has slowed alongside it, which he sums up as a less one-sided US growth story
On a 12-month view the direction is the same — a gradual decline in the dollar index towards 96
Narrowing global interest rate divergence and persistent US fiscal and external balances are the medium-term weights on the currency
Softer labor and inflation momentum support the Fed staying on hold, while Gill notes Australia's RBA and Europe's ECB "also holding that hawkish bias", which should keep chipping away at the dollar's relative rate advantage
Gold Back to Overweight
Asked for the notable portfolio changes in this outlook, Gill goes straight to gold
Gold is his pick to benefit from the dollar weakness he has just described, and the bank has used the month to reinstate its overweight
The improvement in the outlook came alongside the sharp pullback in the dollar and what he calls a technical break higher in gold prices themselves
The long-term support is central bank buying: emerging market central bank demand continues to underpin the uptrend
In the near term, the still-high inverse correlation with the dollar is the positive catalyst
With the upgrade came new targets: "we've also raised our three and 12-month price targets to 4,750 and 5,000 dollars respectively"
Chew's Wrap
Chew closes by summarizing the session as a take on US bond yields the bank expects to be increasingly capped
She ties the equity overweights to two things at once: the bond yield outlook and the momentum in the AI theme, both supportive of US and Asia equities
On the portfolio change of the week: "gold also seems to have gotten back its shine, where we've reinstated the overweight stance"
She signs off the episode of Through the Noise and points listeners to the outlook the bank is releasing that week
Gill's bottom line is that the yield story has turned: with inflation risk fading and the Treasury leaning against long-end yields, he wants three-to-five-year duration, credit and emerging market dollar bonds for yield, equities overweight with financials broadening the book, and gold back on the overweight list as the dollar drifts lower.
Products, Companies & Tools Mentioned
US Treasury (Responded to the rise in the 30-year yield, and doubled its liquidity support buybacks in 10- to 30-year debt from $2 billion to $4 billion per operation through early November — the move Gill calls a new headwind for the dollar)
Federal Reserve (Softer labor and inflation momentum support the bank's view that the Fed can remain on hold, which is what eases rate hike concerns at the short end)
European Central Bank and Bank of Japan (Expected to raise rates further, which is what would make the financials preference pay off in Euro area and Japan equities; the ECB is also grouped with Australia's RBA as holding a hawkish bias)
Gold (Upgraded to overweight this month on dollar weakness, a technical break higher and emerging market central bank demand, with three and 12-month price targets raised)
US dollar index (Forecast cut to 98 on three months and 96 on twelve, on the Treasury's buyback move, narrowing rate divergence and persistent fiscal and external balances)
Emerging market US dollar government bonds (Where the bond overweight actually sits, on fiscal fundamentals)
US investment-grade corporate bonds (The one short-term exception to the yield case, facing excess supply from elevated hyperscaler debt issuance)
Financials (Preferred across the US, Euro area and Japan as a direct beneficiary of a steeper curve through expanding net interest margins, and the sector Gill uses to broaden equity exposure)
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