Bank of Canada raises key rate by 25 bps to 4.75% vs. 4.5% est.
The Bank of Canada defied expectations by restarting its interest-rate tightening campaign, saying the economy is running too hot.
Source: Bloomberg
Italy Maintains Investment Grade Status: Moody's Decision Confirmed!
In a crucial development for Italy's economic landscape, Moody's has confirmed the nation's BBB- sovereign debt rating after conducting a comprehensive review of its credit profile. This decision reinforces Italy's investment grade status, providing stability and reassurance to the market. The anticipated outcome is evident in the behavior of the spread between Italian and German 10-year yields, which has remained steady, along with remarkably low volatility in this spread over the past few weeks. Source: Bloomberg
Favouring high-quality bonds over other asset classes in the coming months?
BofA's traditional monthly survey of global fund managers has been released and shows that investors are the most overweight bonds over stocks since March 2009! Investors are also the most record longs in Investment Grade vs. High Yield since inception (2015). Source: Bank of America
Largest weekly outflow since 2020 in U.S. High Yield bonds!
Last week, one of the largest ETFs tracking U.S. high yield bonds, the HYG or iShares iBoxx HY Corporate Bond ETF, had its largest outflow since 2020. Valuations are stretched in high yield despite solide fundamentals. Any spike in equity volatility could quickly negatively impact this segment. Source: Bloomberg
Global bond sales to record start!
In less than three weeks, governments and corporates raised nearly $600 billion in new financing, a record. This new record was helped by both the best start ever for global fixed income indices and the largest inflow into investment grade bonds in over a year. Source: Bloomberg
For the first time, more money was raised in the debt markets for climate-friendly projects than for fossil-fuel companies
Source: Bloomberg, Michael Jackson
