Seek high yield opportunities, but be aware of liquidity conditions

Friday 02 August 2019

Research / Market

Seek high yield opportunities, but be aware of liquidity conditions

Speculative grade bonds have been among the major beneficiaries of the rapid turn of both Fed and ECB monetary policy stances to much more dovish positions. Lower rates for longer and more synchronised easing mean much lower funding costs and easier financial conditions for HY companies, which, as we know, are more sensitive than IG companies to the absolute levels of nominal and real rates.

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