Conditions in the structured finance market have changed significantly, with rates up, spreads wider, and issuance falling off a cliff.
August 09, 2022
There are a lot of mixed messages in a market that has deteriorated very quickly. We take a look at the influencing factors, what is happening, and what could potentially be next.
- An off-putting half: Risk off, with a recalibration of expected losses.
- Subprime credit is deteriorating: Will there be contagion?
- RMBS: AAAs pricing like BBs
- CMBS: Steeper credit curve
- Rates: As expected, and they got a 75-bps hike at the July 27 meeting, but maybe more would have been better?
- ESG: A luxury in hard times or more important than ever?