The dollar credit markets have performed well in recent weeks, bolstered by stronger than expected US growth of around 2%, the gradual normalisation of monetary policy and, especially, the resurgence of optimism related to a possible tax reform. Dollar IG credit spreads tightened by 9bp in September and by more than 23bp since the beginning of the year.
CFA, Credit Strategy
Valentine AINOUZ, Sergio BERTONCINI, Roberta FORTES, Silvia DI SILVIO, Annalisa USARDI
Until recently, the increase in China’s economic weighting manifested on the currency markets primarily through the impact the country’s economy had on commodity prices. The trend in the renminbi itself had relatively little impact on the other currencies because the renminbi was extremely stable and closely pegged to the dollar. That said, recent monetary reforms changed the game in a big way.
Bastien DRUT, Roberta FORTES