US Investment Grade (IG) Credit Default Swap (CDS) spreads fell to its lowest since February 2020. CDS spreads are a broad measure of credit risk and for the investment grade universe in the US, these are measured by Markit’s CDX IG index. The CDX IG index fell below the 50bp level, considered an important level with Barclays strategists noting that it has broken through “the elusive 50bp barrier”. They added, “The market seems to be focused on the patient stance of the Fed… The strongest Treasuries rally in a year is encouraging investors to pile back into riskier assets as they grow more confident the Federal Reserve is right to call a surge in consumer prices transitory”.
US IG CDS Spreads Go Below 50bp, Lowest Since Feb 2020
