Summary

• The Bloomberg 1-3 Year Government/Credit Index returned 0.28% in Q1, its lowest quarterly return since Q4 2024 (-0.02%).
• The entire Treasury yield curve pushed higher in Q1, with most of the shift taking place in March after combat operations began in the Middle East.
• The investment-grade corporate market, as tracked by the Bloomberg US Corporate 1-3 Year Bond Index, posted its weakest quarterly return (+0.30%) since Q4 2024 (+0.19%).
• The securitized sector delivered positive returns in Q1, bucking the trend of the other major sectors and rising 0.40%.

Market review and outlook

The Bloomberg 1-3 Year Government/Credit Index returned 0.28% in Q1, its lowest quarterly return since Q4 2024 (-0.02%). Through the first two months of the year, the index returned 0.75% as economic data remained broadly resilient despite

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