The PGIM Global High Yield Fund, Inc (GHY) is experiencing price pressure due to a confluence of factors affecting the bond market. A significant driver is the surge in global bond yields, particularly U.S. Treasury yields, which have been rising as investors react to persistent inflation and robust economic growth. This increase in yields is putting pressure on fixed income products, as higher yields make existing bonds less attractive. Additionally, the Federal Reserve's cautious stance on monetary policy, amid concerns that inflation may remain elevated, is contributing to the upward pressure on yields. The bond market is also grappling with increased debt issuance by governments, further exacerbating the supply-demand imbalance and pushing yields higher.
The broader macroeconomic environment is also influencing the high-yield sector. The U.S. services sector's unexpected expansion and the rise in job openings have bolstered economic growth expectations, leading to a reassessment of interest rate trajectories. This has resulted in a challenging environment for high-yield bonds, as investors demand higher returns to compensate for increased risk. Furthermore, the global landscape is marked by fiscal uncertainties, particularly in the UK, where bond yields have reached historic highs, adding to the volatility in the bond markets.
The GHY ETF is currently priced at $12.91, reflecting a 0.35% decrease from the previous close.