CG ASSET MANAGEMENT - CGAM: All you need to know about Index-Linked Bonds

Structural inflation drivers may make index-linked bonds, priced via the break-even inflation rate, more relevant than traditional nominal bonds.

• Structural inflation regime: Source argues reversing globalization (tariffs), Middle East energy shocks, and heavy government deficit spending are ending the 'great moderation' low-inflation era, pushing inflation 'higher for longer.'
• Historical precedent: Cites Alexander the Great's 243 BC silver influx causing wheat prices to spike 13x, and Rome's Antoninianus coin losing 90% of its silver content, driving chronic inflation.

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