JPMorgan Asset Management's Priya Misra Talks US Bonds

Summary

Podcast Summary: Bloomberg Talks

Episode: JPMorgan Asset Management's Priya Misra Talks US Bonds
Date: August 14, 2026
Guest: Priya Misra, JPMorgan Asset Management
Host/Interviewers: Bloomberg Team (Francine Lacqua, Moderator, Interviewer)
Theme: Deep Dive into U.S. Bonds, Market Dynamics, Fed Policy, and Macro Forces

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Episode Overview

This episode features a focused conversation with Priya Misra, a leading figure at JPMorgan Asset Management, discussing the current state and outlook for U.S. bonds. The conversation explores rising yields, the buyers of U.S. Treasuries, expectations for the Federal Reserve, and how macroeconomic trends—including AI-induced productivity—factor into the bond market. The tone is informed, conversational, and accessible for both experts and listeners wanting a coherent picture of complex financial developments.

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Key Discussion Points & Insights

1. Current State of U.S. Bond Yields and Auctions

• Yields and Market Sentiment:
  • Priya expresses comfort with current rate levels, noting that “there is income in fixed income”—meaning current yields provide both return and hedge potential.
    • Quote (Priya Misra, 01:06): "I like rates here. I mean as a. There is income in fixed income. There is also the ability for capital appreciation if the economy slows down."
• Auction Dynamics:
  • Recent Treasury auctions have been healthy; demand remains stable even with high supply.
  • The fear would be if “dealers have to take it all down,” signaling weak demand—but that's not happening.
• Historical Context:
  • Despite headlines, rates today are not abnormally high when viewed from a pre-2008 or late-90s perspective.
• Market Adaptation:
  • Investors are adjusting to a “new normal” of higher rates as a reflection of supply, productivity improvements, and demand dynamics.

2. Who is Buying U.S. Treasuries Now?

• Shift in Buyer Base:
  • Foreign central banks and the Fed have less relative dominance; “price sensitive buyers” (e.g., asset managers, U.S. households via retirement and brokerage funds) are the principal buyers.
    • Quote (Priya Misra, 02:23): "It used to be foreign central banks, it used to be the Fed and now it's what I call price sensitive buyers and which is why these interest rates have risen."
• Term Premium:
  • The rise in term premium (the extra yield for holding longer-term bonds) is partly due to changing buyers.
• Continued International Interest:
  • Foreign investment isn’t gone—it’s just lower than a decade ago due to today’s higher yields being attractive even to a smaller pool.

3. Upcoming Jackson Hole Central Banking Symposium

• Why It Matters:
  • The event gathers central bankers to discuss economic trends and monetary policy.
• Anticipation Over Fed “Reaction Function”:
  • Market uncertainty revolves around how the Fed will respond to new data, including inflation and growth metrics.
    • Quote (Priya Misra, 03:54): "I think we want to understand as data comes in, the Fed doesn't know the data and nor do us. But as the data comes in, how would the Fed react?"
• Chair Walsh’s Communication (Implied Fed Chair):
  • The market is watching for clues as recent Fed guidance has left some ambiguity.

4. Yield Curve and Spread Analysis

• Yield Curve as a Tool:
  • The shape of the yield curve remains a central gauge for bond investors, not just media hype.
• Real Rate vs. Inflation:
  • Recent steepening of the curve is more linked to real rates than to inflation expectations, reinforcing the Fed’s credibility.
• Investment Strategy:
  • Current spread levels are becoming attractive for extending maturities (buying longer-dated bonds).
    • Quote (Priya Misra, 04:54): "What we're finding is its real rate, which makes us like further out the curve a little bit more."

5. Macro Trends: AI, Productivity, and Inflation

• Historic Perspective:
  • Priya references her academic background in debating economics and productivity trends.
• Impact of Technological Evolution (AI):
  • She draws parallels between past shifts and current AI-driven changes, noting these are often “disinflationary” and do not usually lead to mass job loss—but transition periods can be turbulent.
    • Quote (Priya Misra, 06:04): "From a macro standpoint, this is actually, it tends to be disinflationary. It doesn't tend to result in massive job losses. But there's a transition period and we're sort of, I think, in that moment right now."

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Notable Quotes & Memorable Moments

• On the Market's Adjustment to Higher Rates:
  • Priya Misra (01:52): “We just have to get used to the new normal of better, you know, higher interest rates.”
• On Auction Health and Fiscal Supply:
  • Priya Misra (01:11): "If there wasn't demand to meet this supply, I think then there would be angst. But right now the auctions were fine."
• On the Evolution of Treasury Buyers:
  • Priya Misra (02:23): "Now it's what I call price sensitive buyers... asset managers...households."
• On Technology and Macro Effects:
  • Priya Misra (06:04): "There'll be winners and losers, but from a macro standpoint, [AI evolution] tends to be disinflationary."
• On Education and Perspective:
  • Priya recalls Indian college debates about productivity, linking historical cycles and today’s AI conversation (05:39-06:25).

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Timestamps for Essential Segments

• Introduction and Auction Outlook: 00:37–02:20
• Who is Buying Treasuries Now: 02:20–03:11
• Jackson Hole and Fed Policy Outlook: 03:11–04:27
• Yield Curve, Spreads, and Investment Strategy: 04:27–05:24
• AI, Productivity, and Inflation History: 05:24–06:25
• Personal/Educational Reflection and Episode Close: 05:39–06:44

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Overall Takeaways

• Market Stability: Despite worries about debt supply, there is robust demand for U.S. fixed income at current yields.
• Changing Landscape: Asset managers and U.S. "households" now soak up more of the supply as global central banks play a smaller role.
• Fed in Focus: The Jackson Hole meeting and the evolving Fed “reaction function” are key for markets in the coming weeks.
• Yield Curve Matters: The current curve, indicative of real rates, makes longer-term bonds attractive to informed investors.
• Macro Shifts: AI-driven productivity has important, generally disinflationary implications for the future—recalling past economic debates.

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This summary captures the essence and key insights from Priya Misra’s practical, context-rich perspective on the U.S. bond market as it stands in mid-2026.

Transcript

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[Podcast Interviewer]

What a joy on a non like Fed day. Yeah jobs day now conversation with premium misra of JP Morgan. Sort of like on a quieter day where we can be calmer. There's charts out there pre Emisra of like higher yields and it's worry. OMG 30 year bond. Are you have angst here? I think I read the auction and people showed up to buy our paper. Do you have angst or is it like okay to have rates here?

[Priya Misra]

I like rates here. I mean as a. There is income in fixed income. There is also the ability for capital appreciation if the economy slows down. Fixed income is providing you that hedge. But since you bring up the auction, you know, the auction was actually fine. We look at to cover, we look at end user demand. Dealers have to take it all down. That would create a lot of angst because we have a ton of debt. The US government, global governments, corporates. If there wasn't demand to meet this supply, I think then there would be angst. But right now the auctions were fine. Interest rates have risen. But I think if you zoom out and you go back to the late 90s or the pre Lehman time period, actually interest rates don't look particularly odd. I think they are pricing in all the supply that's coming in. They're pricing in potentially higher productivity through AI. But there is still I would go back to. We're seeing inflows into fixed income. So there's demand for Treasuries, there's demand for all the corporates now at wider spreads at higher new issue concessions. So there's a price that the market is demanding for all the supply but the demand is there at a price. And I think that's what we're. We just have to get used to the new normal of better, you know, higher interest rates.

[Podcast Moderator]

Who buys our treasury securities these days?

[Priya Misra]

Great point because I think it has changed in the last 10 years. It used to be foreign central banks, it used to be the Fed and now it's what I call price sensitive buyers and which is why these interest rates have risen. What we call term premium, which is how much more you should get paid to extend out the curve that has risen. So who's buying it? It's people like us. It's asset managers. It's what the Fed calls households, which is not necessarily the average person on the street. But if you have any money in a retirement account or in a brokerage account and you put it in a fixed income fund, so those are the largest buyers. But I would say US banks are biased and foreign investors are still buying Treas Treasuries. Given the yield, given the fact that the Fed is credible, I think that there's still that, that demand from the rest of the world, it's just smaller than it was 10 years ago.

[Podcast Moderator]

This Jackson Hole thing is going to be I think important for the market coming up later this month. It's so important that we're sending Tom Keene and Michael McKee out the Jackson Hole here to cover it for us. What are you looking for?

[Priya Misra]

I'm very jealous. I know Jackson Hole is like the ultimate holy grail. All these central bankers get there. They debate topics. So Tom, enjoy. It's, it's an important, very important meeting I think particularly right now because there's uncertainty around the economic outlook. There always is. Now there's uncertainty about the Fed reaction function. And it's not just one reaction.

[Podcast Moderator]

Reaction function is for people that don't know, it's just how the Fed reacts. Do we know how the Fed's going to react to a certain piece of economic data? Is that what we're talking about?

[Priya Misra]

Exactly, yes. I think we want to understand as data comes in, the Fed doesn't know the data and nor do us. But as the data comes in, how would the Fed react? Do they, is there a trigger point? Do they need inflation to get back to 2% this year? That's a high bar. Do they just need it to decelerate? Which is, it is doing that to allow them not to hike. So I think getting a sense. I know Chair Walsh has not given us much of a sense of his reaction function but other Fed officials have. So what I'll be watching is his speech, other Fed officials on that reaction function.

[Podcast Interviewer]

This weekend everyone's going to go hysteria. I love Barron's Saturday morning is just is very valuable. Okay, fine. And they're going to all analyze spreads, the difference between the 2 year, the 10 year yield, the 3 month, the 30 year. How does pre and Misra use spreads to get a confidence to buy the next marginal bill note bond.

[Priya Misra]

So you're talking about essentially the yield curve. So has the curve steepened out enough?

[Podcast Interviewer]

Is it a constructive tool for you or is it just a media frenzy?

[Priya Misra]

Oh, it's an important tool. I would decompose it further to say, is this real rate or is it inflation? What we're finding is its real rate, which makes us like further out the curve a little bit more. So, yes, you know, I think the curve has steepened. The market is charging, is paying you more or is asking for more real rate. And that makes me feel like the Fed is still credible. The market expects inflation to come back down. I think these spreads are starting to look attractive. To extend out the curve, I want

[Podcast Interviewer]

to ask one question. We've got to go to Colonel Sanders. Here we look at the Eastern Mediterranean. What was it like when you got into Lady Sri Ram College in Delhi? Like, that's the most prestigious economics program, right?

[Priya Misra]

It's a good program. It's all of us debating economics. And actually it was in the late 90s we were debating productivity. So some of what we're going through now is I go back to when I was in school. What does new technological, you know, evolution. What does it mean? Does, is it disinflationary? Does it raise our star? The debate that do we have a

[Podcast Interviewer]

classic capital deepening with all this AI CapEx?

[Priya Misra]

Exactly. And you know, there'll be winners and losers, but from a macro standpoint, this is actually, it tends to be disinflationary. It doesn't tend to result in massive job losses. But there's a transition period and we're sort of, I think, in that moment right now. So I go back a lot to when I was studying economics and it's useful.

[Podcast Interviewer]

Priya, thank you so much. What a joy to have her in. What's the Fed going to do like a day like that? Preemiser, you know why she's here? She's the only one in the office today at JP Morgan. That's what it is. Priya Misera, thank you. Thank you so much as everybody. Bob, Michael and team are work from home, to say the least.

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why great leaders embrace conflict.

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