Corporate Bonds
Credit-selection driven approach aiming to find value, anticipate trends, and capture rising stars within corporate bond markets.
Global Credit Outlook for Summer 2026: Navigating credit markets
Fixed Income Boutique
As we head into the summer, credit markets are navigating an increasingly complex landscape. Inflation pressures are building up - particularly in Europe - while central banks are diverging in their policy responses, with most preparing for tighter monetary policy. Meanwhile, recent market volatility has created dispersion across sectors and rating categories, opening doors for active managers.
Our latest Global Credit Outlook unpacks these dynamics and tries to answer the 10 most pressing questions on investors’ minds.
In breve
- Macroeconomic Trends: US growth remains decent, and the rest of the G7 is catching up, supported by overall stimulative but diverging fiscal policy. Inflation is creeping higher, especially in Europe, putting central banks in a bind - the Fed faces a now familiar dilemma between supporting growth and containing prices.
- Corporate Credit Health: Fundamentals remain solid. Margins are near all-time highs, EBITDA growth expectations are strong, and the rating trend is balanced, translating into a higher-quality investment universe. Default rates are expected to trend lower, but selectivity matters as the cycle is slowly fading.
- Technicals and Bond issuance: Global corporate issuance is on track to hit another record in 2026, fuelled by AI-related capex and rising M&A activity. Hyperscalers are reshaping the structure of the corporate bond market. Demand remains supportive, with coupon reinvestment creating a natural bid for credit.
- Valuation and Opportunities: Yields remain at multi-year highs. It is attractive relative to equities, and recent volatility has widened dispersion across sectors, currencies, and rating segments. We believe that this creates fertile ground for relative value plays and targeted positioning.
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