Top bond manager sees income opportunities in the second half of 2026

Franklin Templeton Fixed Income chief investment officer Sonal Desai said income investors can still find attractive yields in the second half of 2026, even as markets weigh the Federal Reserve’s next moves and inflation stays above target. In an interview with CNBC, Desai pointed to highyield bonds, structured credit, selected private credit, emerging markets, and developed markets outside the U.S. as areas she thinks offer potential income opportunities. She emphasized active management and bottomup research, saying investors should focus on income rather than capital gains. Desai also noted that Treasury yields remain elevated, credit spreads are tight, and economic fundamentals are still solid. She suggested that investors seeking liquidity could consider ultrashort bond funds instead of holding only cash, while those looking for diversification may want multisector bond funds.