Income-oriented investors, in a world of increasingly divergent monetary policies, should look beyond U.S. borders to capture solid yields and cross-market arbitrage opportunities.
That is the thesis put forward by Invesco, whose case is made through Kristina Campmany, the firm’s senior portfolio manager for global debt. She argues that the differing trajectories of central banks are creating fertile ground for flexible fixed-income strategies.
While the Federal Reserve and the Bank of England held rates steady through 2026 after cutting in late 2025, other institutions have moved in the opposite direction: the European Central Bank, the Reserve Bank of Australia and the Bank of Japan raised the cost of money in the wake of tensions triggered by the conflict in the Middle East, while Brazil began a cycle of easing. This heterogeneity, according to Campmany, opens concrete room to extract value outside the American market, where domestic dynamics are more uniform and offer fewer operating levers.
The instruments to consider
The vehicle Invesco has chosen to translate this view into a portfolio is the Invesco Flexible Income ETF (FLXI), launched in February 2026. With a 30-day yield of 4.93% and an expense ratio of 0.39%, the fund allocates up to 40% of its assets to international instruments. That is a competitive profile compared with purely domestic products such as the Vanguard Total Bond Market ETF (BND), which offers a 30-day SEC yield of 4.65% at a cost of 0.03%, or the iShares Core U.S. Aggregate Bond ETF (AGG), at 4.68% with the same expense level. The yield gap, though not enormous, reflects FLXI’s ability to capture risk premia and carry from less-correlated markets, partly offsetting its higher management costs through greater geographic and sector diversification.
The approach is not isolated. Rick Rieder, head of global fixed income at BlackRock and manager of the iShares Flexible Income Active ETF (BINC), said in July that he had increased exposure to European credit and to some emerging-market bonds, bringing BINC’s international share to roughly 30%. The convergence of views between two of the largest asset managers confirms that the hunt for yield is pushing portfolios beyond traditional borders, precisely at a moment when the “crosswinds” — the crossed currents of monetary policy, geopolitics and liquidity — are multiplying opportunities for tactical positioning.
Within FLXI, the largest geographic allocation outside the United States is to the United Kingdom. In July the Bank of England voted 6-3 to leave rates unchanged, with the three dissenters favoring a 25-basis-point hike. Campmany acknowledges that the British market still bears the scars of the Liz Truss episode of 2022, when the prime minister’s brief government triggered a spike in volatility and a liquidity crisis in gilts (UK government bonds). Yet it is precisely that traumatic memory that has created price distortions now attractive to anyone willing to dissect flows and the structure of institutional demand carefully.
Emerging-market segments in fixed income
The emerging-market segment looks even more compelling. After the pandemic, central banks in these economies raised rates more aggressively than their developed-market counterparts, starting from already-high nominal levels. As a result, they now have more room to cut the cost of money without jeopardizing currency stability. Campmany focuses in particular on Brazil and South Africa: FLXI holds 5.2% in South African assets and 1.5% in Brazilian ones. Brazil has already made three cuts and, according to a recent Reuters survey, further easing was expected at Wednesday’s meeting. South Africa, after raising rates in May for the first time in three years, held them steady in July, still offering a generous carry profile. In Central and Eastern Europe, the preferences go to Hungary and the Czech Republic, markets that combine reasonable valuations with the prospect of converging toward more accommodative policies.
On the domestic front, Invesco favors securitized products — asset-backed securities, mortgage-backed securities and floating-rate instruments — which it considers cheaper than corporate bonds on both absolute valuation and technical supply-and-demand dynamics. These instruments are also less exposed to shocks that could stem from the evolution of artificial intelligence and its related financing flows, acting as a natural buffer within a portfolio that already carries geopolitical and external monetary-policy risk.
The strategy Invesco outlines does not simply chase the highest nominal yield; it builds a mosaic of exposures that exploit cyclical divergences and the residual inefficiencies left by the shocks of recent years. In an environment where central banks no longer move in unison, the ability to manage multiple levers — duration, credit, currencies and securitized segments — becomes the real competitive advantage for income investors. In this sense FLXI represents not merely a yield vehicle but an active laboratory of global allocation, in which operational flexibility and geographic selectivity combine to produce a risk-return profile hard to replicate with domestic instruments alone.
Disclaimer: The information and considerations in this article should not be used as the sole or primary basis for making investment decisions. Readers retain full freedom in their investment choices and full responsibility for them, as only they know their own risk tolerance and time horizon. The information is provided for informational purposes only and does not constitute an offer or solicitation to the public.
Editor’s note
This article was originally published in Italian on money.it by Money.it Premium desk on August 06, 2026 as «I bond americani non bastano più. Ecco dove si nascondono i veri rendimenti sull’obbligazionario». It has been translated and adapted for an international audience by the Money.it International desk.
