FICC Focus

SVP operates as “one big virtual global office” built on three functional “pillars” — sourcing, dealmaking and its operating partners — according to HJ Woltery, the firm’s co-head of the European investment team. Bloomberg Intelligence’s Noel Hebert and Phil Brendel had an in-depth feature interview with Woltery on European distressed debt. They delved into SVP’s investment approach and how the restructuring landscape varies from the US and among European countries (7:15). Prior to that, Hebert and Brendel discussed August’s telecom-led credit rally and what the start of rate cuts means for the corporate credit cycle. The podcast concludes with BI’s Negisa Balluku joining the two for a roundtable discussion covering Avon, Hertz’s make-whole decision, Gol airlines, TPG, Diamond Sports, Mallinckrodt, Yellow Corp. and the proliferation of cooperation agreements (1:02:25).

The new supercore CPI to watch is the Bureau of Labor Statistic’s Quarterly Census of Employment and Wages, given US Federal Reserve Chair Jerome Powell’s comments on monthly non-farm payroll gains, says Anna Wong, chief US economist for Bloomberg Economics. Wong is joined by Macro Matters podcast host and Bloomberg Intelligence’s chief US rates strategist Ira Jersey to discuss key details and takeaways from the Federal Reserve’s 50-bp rate cut and accompanying policy announcement. The pair unpack the implications of changes in the Fed’s summary of economic projections as well as the outlook for the economy relative to current market pricing. They also discuss potential implications for monetary policy in the context of the upcoming presidential election.

David Dwyer, the director of global research at Bloomberg Intelligence, dives into the transformative impact of AI on financial research. He discusses how machine learning enhances analytical workflows, making them faster and more comprehensive. Dwyer emphasizes the balance between technology and human expertise, addressing data reliability issues and the skills analysts need in this evolving landscape. The conversation also touches on the DSX project, showcasing how AI can streamline data management and improve insight discovery for investors.

The performance of the broad muni index has been positive this year, while also notably falling short of the stronger showing by its fixed-income counterparts. However, the real winners can be found in the lower-rated muni credit rungs, with the Bloomberg Muni High Yield index leading the way. In the latest Masters of the Muniverse episode of Bloomberg Intelligence’s FICC Focus podcast, Eric Kazatsky and Karen Altamirano are joined by John Loffredo, vice chairman of MacKay Shields, to discuss the changing landscape of munis and how risk-managed relative-value approaches can help uncover opportunities.

Credit markets have had a strong year, a few blips notwithstanding. After the ECB cut rates twice, the BOE once and with the Fed about to embark on a long cutting cycle, are credit spreads too tight and priced for perfection? Is the rally in yields justified on expected rate cuts until 1H25? In this episode of our Credit Crunch podcast, host Mahesh Bhimalingam, chief European credit strategist at Bloomberg Intelligence and Jamie Irvine, investment director at abdrn, discuss the state of credit across the US, UK, and Europe.They tackle relative value across credit in different currencies; junk and high grade; fund flows and supply; defaults and ratings; and fundamental views. They also address the sterling credit market, and the impact of elections across the US, UK and Europe.

Audrey Childe-Freeman, chief G-10 FX strategist at Bloomberg Intelligence, and Stephen Chiu, chief Asia FX and rates strategist, dive into the complexities of de-dollarization amid looming U.S. elections. They explore how geopolitical shifts, particularly China's push for the yuan, impact global currency dynamics. The duo also discusses central banks' increasing gold purchases in response to inflation and doubts about the dollar's future credibility, highlighting the ongoing tension between the U.S. and China.

In this edition of the All Options Considered podcast, BI's Chief Global Derivatives Strategist Tanvir Sandhu covers the VIX at 65 being due to market technicals and unreflective of fundamentals, as well as the support for rates volatility from uncertainty around the pace and extent that policy rates decline rather than the direction of travel, which is clear cut.

Emerging Market corporate and quasi-sovereign debt is outperforming the broader EM sovereign-credit complex, as the asset class returns to favor following years of below-average bond issuance. In this month’s EM Lens & Look-Through podcast, Emerging Market Portfolio Manager at Schroders Autumn Graham joins Bloomberg Intelligence’s Damian Sassower, chief EM credit strategist, to discuss the risk-return tradeoff in EM corporate credit. Graham and Sassower touch on issuer fundamentals, market depth, foreign positioning, geopolitical risk and the impact of deglobalization.This podcast is part of BI’s FICC Focus series.

Macro credit trends tend to be based on more of a feel than precise numbers. In this latest episode of the Credit Crunch podcast, Mahesh Bhimalingam, Chief European Credit Strategist and Heema Patel, Senior Credit Strategy Associate at Bloomberg Intelligence, delve into proprietary research and data on BI STRTE to make macro credit very precise. Explore their novel spread-prediction model with market and macroeconomic drivers, insights on index metrics -- default rates, rating quality/drift and credit ratios. They also discuss if green bonds are trading at a premium or discount, a methodology contrasting with the conventional greenium calculations.Lastly, they address the main derivative play in credit, the cash-CDS basis and gain perspective on current market patterns and uncover alpha-generating opportunities.

Stuart Paul, an economist for Bloomberg Economics with expertise in US and Canadian economies, discusses the complexities of Canada’s current economic landscape. He highlights the impact of immigration on housing crises and rising mortgage rates. Paul dives into the unique monetary policy frameworks of the Bank of Canada, contrasting them with other central banks. He also analyzes Canada’s fiscal sustainability, revealing its advantage over the US, and addresses the delicate balancing act of managing interest rates amid economic growth concerns.