Amundi buys two-year US Treasuries to hedge against growth slowdown

When the world’s largest asset managers start hoarding the safest, shortest-duration government debt they can find, it’s worth paying attention. Amundi SA, which oversees roughly €2.58 trillion in assets, is doing exactly that, snapping up two-year US Treasuries as a defensive play against the risk that elevated oil prices drag the global economy into a slowdown. The move comes after a sharp selloff rattled bond markets in early September, driven by oil prices surging to a four-month high amid escalating tensions in the Middle East. For Amundi, the playbook is familiar: when geopolitical shocks spike volatility, park capital in bonds that mature quickly and carry less interest-rate risk. Why two-year Treasuries, and why now Amundi’s Group CIO Vincent Mortier flagged the firm’s appetite for one- to two-year bonds back in April, describing “significant additions” to those maturities. The September selloff, which saw two-year Treasury yields spike as oil-driven inflation fears collided with growth concerns, appears to have offered the kind of entry point the firm was waiting for. Rising oil prices act like a tax on consumers and businesses alike, eroding spending power and squeezing m...