BlackRock predicts that bond exchange-traded fund assets globally will hit $5 trillion by the end of 2030, fueled by four trends, one of which involves increased use among institutional investors.
"The global bond ETF industry is growing even faster than we expected," BlackRock said in a paper released Wednesday. "The pandemic era accelerated bond ETF adoption in ways that are self-reinforcing and, we believe, enduring."
BlackRock's iShares launched the first four bond ETFs in the U.S. in July 2002. Nearly 20 years later, bond ETFs as an industry have grown to $1.7 trillion in assets under management and more than 1,400 products globally, according to the paper, "All systems go."
It took 17 years for bond ETF assets to hit $1 trillion, the paper said. Three years ago, as the industry was nearing that milestone, BlackRock predicted that global bond ETF assets would double by the end of 2024, the paper said.
"Yet we believe the global bond ETF industry is poised to reach $2 trillion in 2023 — 18 months early — despite currently challenging macroeconomic conditions," the paper said.