Pimco's Balls Sees Good Value in Long End of Yield Curve

• Pimco expects 1-2 additional Fed rate hikes to meet the 2% inflation target.
• The market currently prices a low probability for an October hike, with later hikes closer to 50/50.
• Good value is seen in the long end of the Treasury yield curve (10-year and 30-year).
• Uncertainty in the AI sector could lead to flows into fixed income, creating potential for capital gains in longer-duration bonds.

Andrew Balls of Pimco anticipates 1-2 more Federal Reserve rate hikes to achieve the 2% inflation target, noting current market pricing for future hikes. He identifies 'good value' in the long end of the Treasury yield curve (10-year and 30-year), suggesting potential for capital gains driven by uncertainty surrounding the AI sector.