Recession seems unlikely this year—opening up opportunities in credit.

Global growth uncertainty has accelerated while inflation appears likely to persist. Still, we anticipate neither recession nor stagnation; moreover, central bank tightening expectations have likely peaked, potentially normalizing interest rate volatility and supporting spread sectors. In our view, investors should position themselves for a two-way market, emphasizing liquidity and looking for opportunity in investment grade credit, securitized products and high yield.