FORT LAUDERDALE, FL--(Marketwire - Sep 4, 2012) - Templeton Global Income Fund (
Beginning with the September dividend, the Fund's monthly dividend will be adjusted from $0.045 to $0.035 per share. Dividends may vary based on the Fund's net investment income. Past dividends are not indicative of future trends. Over the past few years, interest rates around the globe have decreased in response to the slow growth economic environment. The Fund's dividend adjustment reflects the current environment of historically low interest rates and reduced yields available in government bonds.
The Fund's investment team continues to believe that the current period of accommodative monetary policy by developed country central banks will eventually need to end, resulting in rising interest rates from current record low levels. This poses downside risk for bond prices, so the Fund has been positioned in very low duration and short maturity bonds to mitigate downside risk when interest rates rise. In general, shorter duration and maturity bonds have lower yields than longer duration/maturity bonds.
The Fund's investment team has continued to look for attractive yields in short-maturity government bonds around the world. However, as bond yields have declined globally, the Fund's investment team have been reinvesting at lower yields as these positions mature. As a result, the Fund's distribution yield needs to be adjusted downwards accordingly.
While the Fund's distribution yield has been adjusted down, it is still relatively high given the current low interest rate environment. Furthermore, the Fund is well positioned in low duration exposure to protect against price erosion when interest rates shift to a rising rate cycle.
The Fund's investment manager is a wholly owned subsidiary of Franklin Resources, Inc. (