PGIM Absolute Return Bond Fund Q1 2026 Commentary (PADZX)
PGIM Investments·2026-06-19·via All Articles on Seeking Alpha
Summary
The surprise of war and potential inflation boost caused a rapid unwind of rate positions as investors recognized many central banks would be forced to shift from an easing to hiking bias.
For the U.S., PGIM has revised the base case economic scenario over the next 12 months from 'Muddle Through' to 'Overheating.'
The PGIM Absolute Return Bond Fund outperformed its benchmark, the Bloomberg U.S. Aggregate Bond Index, on a gross basis.
The PGIM Absolute Return Bond Fund's duration positioning detracted from results as yields across the U.S. Treasury curve rose.
The Iran war abruptly shifted the conversation away from tariffs and towards inflation, with oil and oil-related products and global natural gas rallying materially.
Dilok Klaisataporn/iStock via Getty Images
Market Review
Coming into 2026, investors spun a comfortable narrative that a gradually slowing global economy caused by a weakening labor market would elicit moderate policy accommodation. Since the start of the conflict in Iran, the main
