Fixed Income
Credit Market Euphoria Is Like Rate Hikes Never Happened
The riskiest global debt is outgunning safer fixed-income assets. Investor euphoria harks back to the days before central bank rate cuts.
Jerome Powell, chairman of the US Federal Reserve, during a Senate Banking, Housing, and Urban Affairs Committee hearing in Washington, DC, US, on Thursday, March 7, 2024.
Photographer: Al Drago/BloombergThis article is for subscribers only.
The most punishing interest-rate hikes since the 1980s. The high degree of uncertainty over when and how quickly central bankers will start reversing them. Yet another US lender hitting trouble barely a year after debt markets were upended by the collapse of one of the world's biggest banks.
Credit investors have shrugged all of this off and are acting like the go-go days of the easy money era are back again.