Structured credit update - Navigating the summer months

Over the summer months, global markets continued to grind higher thanks to supportive central bank policies, expanding vaccination programmes and economic reopening. This led to prices rallying for risk assets globally, including most structured credit products – with the exception of CLOs, where spreads widened. Alongside this fundamental picture, we have seen supply technicals play a significant role in driving spreads in the structured credit market, with opposing impact in the ABS versus CLO space.