Fixed income

With the summer holiday season fast approaching, now feels like a good moment to pause and take stock of developments in the European ABS market year-to-date.

The Trump administration’s immigration policy leaves the US labour market at a pivotal juncture.

Collateralised loan obligations, or CLOs, have become an increasingly popular asset class within global fixed income.

The UK Prime RMBS market has continued to evolve in 2025, with a broadening of its participant base driven by the entrance of two new sponsors (Nottingham Building Society and Newcastle Building Society) which have both priced inaugural deals this year.

Primary issuance in the European high yield (HY) market surged in June with €21.2bn of supply marking the highest monthly volume on record.

The turbulent start to 2025 has sent many investors seeking alternatives to US assets, but in our view European fixed income can offer more than just diversification.

Softer US economic data means the pressures on UST yields now look more balanced, but headlines around President Trump’s pick for the next Fed chair are just one reason investors should expect rates volatility to continue.

Recent market volatility has reinforced the value of alpha over beta. While markets rebounded from recent lows, risks persist – from uncertain trade policy to concerns about debt sustainability. But fixed income remains resilient. We are finding opportunities in local currency EM debt, US high yield, and European investment grade credit.

Last week marked another record-breaking year for the securitisation industry as over 5,500 market participants gathered in Barcelona for the annual Global ABS conference, surpassing last year’s attendance and reflecting the growing momentum across both public asset-backed securities (ABS) and private asset-backed finance (ABF) markets.

Discover the key insights from our Q2 Fixed Income webinar, where our experts explored the latest market shifts and strategic positioning opportunities in a rapidly evolving environment.

While tariffs have done meaningful damage to the economic outlook and raised volatility in rates markets, the softening of the US stance has restored confidence in credit returns for 2025.

The US dollar’s reign is faltering, and we believe a prolonged dollar bear market is underway – a scenario that has historically been a tailwind for emerging market economic growth and asset valuations. However, not all emerging equity markets respond equally to the dollar’s decline.

The question for investors now is how much of the macro risk remains, and how well that risk is being reflected in asset valuations.

April was one of the most volatile months across financial markets in recent memory, triggered by President Trump’s sweeping tariff announcement on April 2.

After a chaotic week in global markets following the tariffs announced by President Trump on April 2, at time of writing (April 10) investors are left to contemplate 125% tariffs on China, a baseline 10% on the rest of the world, 25% on auto imports and a 90-day pause on more punitive rates.

While much of the focus in private credit has been on direct lending, Significant Risk Transfer (SRT) is emerging as a compelling alternative. What began as a regulatory tool is now gaining traction with a growing investor base, as banks look to optimise capital and issuance reaches record highs.

“Liberation Day” has landed, and not with a whimper. In extraordinary scenes in the Rose Garden of the White House, President Trump held up a board outlining the level of tariffs the US will impose on countries around the world, and in most cases they were worse than worst-case expectations.

TwentyFour Asset Management’s Eoin Walsh breaks down a turbulent first quarter for investors, driven by newly imposed Trump tariffs and shifting economic forecasts.

TwentyFour Asset Management’s Chris Bowie reflects on a politically eventful first quarter, its impact on European and US markets and what it could mean for investors going forward.

As the first quarter of 2025 concludes, TwentyFour Asset Management’s Pauline Quirin shares her take on the strong performance of the securitisation market and insights for European ABS and Collateralised Loan Obligations (CLOs).

You can now watch the replay of our webinar: A new world order? Where next for markets and Fixed Income?

We remain cautiously optimistic about Fixed Income returns. Tail risks are elevated, which dampens our confidence in “risk on” markets. But alpha opportunities still await risk-aware, active investors. Those who try to predict the next major macro shift may find themselves echoing Luke Skywalker’s words, “your overconfidence is your weakness.”

The incoming German government’s removal of the country’s infamous “debt brake” is a serious pivot for the typically fiscally conservative country, and one that we think highlights the value on offer in European assets.

New world order with Trump 2.0 at the helm. New day, new risks. What’s keeping investors awake at the moment and how does this impact EM Fixed Income?