Skip to Content
Credit Insights

Assets Rise as Global Monetary Policy Gets Even Easier

China cuts rates; ECB hints at easier euro to come.

The markets reacted favorably to the European Central Bank's intimation that it would ease monetary policy further in December and the People's Bank of China's announcement that it had cut its benchmark rates. The average spread of the Morningstar Corporate Bond Index tightened 5 basis points to +172 bps over Treasuries, and the average credit spread in the Bank of America Merrill Lynch High Yield Master Index tightened 21 basis points to end the week at +597. The equity market reacted even more favorably as the S&P 500 rose 2.1%, returning to positive territory for the year. Year to date, our investment-grade index has risen 0.89% and the high-yield index has risen 0.22%

China Cuts Rates; ECB Hints at Easier Euro to Come
As global economic activity limps along, global central banks are trying to force even more liquidity into the markets in an attempt to spur economic growth.