Credit markets: a paradigm shift
In recent years, new structural trends have emerged, such as the polarization of the world, the re-localisation of supply chains, and the fight against climate change. These new trends are leading to higher inflation and lower growth. This new paradigm is having a significant impact on the financial situation of companies, and therefore on investment in corporate bonds. This calls for strategic adaptation on the part of investors. Adopting a strategy that aims to deliver a performance independent of credit market trends would therefore appear to be an investment solution worth considering in this new environment.
The implications of this new paradigm for credit markets are significant in terms of monetary policy, which can no longer be as accommodating as it was in the previous decade. As a result, we can expect more volatile credit spreads, more dispersion between "good performers" and "bad performers", even within the same sector, and higher default rates.
