US-China conflict halts recovery
Credit Markets Weekly , 9. Apr.
Since President Trump's announcement of reciprocal import tariffs, spreads in the corporate bond market have widened significantly in all sectors. Only covered bond and SSA spreads remained stable. The primary market came to a standstill. News of negotiations between the US and Japan caused spreads to narrow briefly. However, the escalation of the trade dispute between the US and China again dampened sentiment. President Trump's contradictory signals suggest that spread volatility will remain high.