US

Last week, the US Federal Reserve (Fed) published the results of its 2026 Dodd-Frank Act Stress Test, with all 32 large banks – including a few subsidiaries of European lenders – remaining above their minimum capital requirements under a severely adverse scenario.

Reading recent headlines in the financial press, in addition to recent proposals from both US and European regulators, you could be forgiven for thinking banks are undergoing a wave of deregulation.

Wednesday’s Federal Reserve (Fed) press conference was one of the most eagerly awaited in a very long time. Kevin Warsh’s debut as chair, after three weeks in post, was not an easy one.

Corporate hybrid issuance is on track for a record year in both Europe and the US, driven by expanding supply well beyond the traditional utilities, energy, and telecoms issuers.

Despite the oil price hanging on every word from the White House and volatility in everything from equities to government bonds, we saw a record day for US corporate bond supply on Tuesday led by a blockbuster deal from Amazon.

Collateralised Loan Obligation (CLO) markets have repriced meaningfully over the past few weeks, with a sell-off in software-related loans leading to even more spread “tiering” as investors differentiate between managers with lower exposure to stressed sectors and those carrying more tail risk.

As Jerome Powell enters his final months at the helm of the Federal Reserve (Fed), market participants have been busy analysing the past speeches of his nominated replacement, Kevin Warsh, with the aim of forming a view as to how his hand is likely to be played.

The month of January has been a very eventful one for markets, mostly courtesy of geopolitical events, ranging from the capture of Venezuela’s sitting president and arguably culminating in Mark Carney’s speech at Davos.

One of the many unusual developments in financial markets last year was the decoupling between German Bunds and other safe haven G7 government bonds, most notably US Treasuries. Since the inception of the euro, it’s been quite a rare event that Bunds and Treasuries move in opposite directions for sustained periods of time.

After a week that saw 10-year Japanese government bonds (JGBs) hit yields not seen since the late 1990’s (and record highs for 30-year and 40-year maturities), alongside one of the most interesting Davos conferences in years, which was held in the shadow of the latest push by President Trump to “acquire” Greenland, it is helpful to take stock of where this leaves the global geopolitical landscape and financial markets.

The new year has begun with a jolt for market participants after the US carried out a military operation in Caracas over the weekend, capturing Venezuela’s president Nicolas Maduro and his wife.

European ABS investors saw just the second solar loan-backed deal price recently, a German offering titled Golden Ray 2. The transaction marks a further incremental development towards sustainable financing in the European securitisation market. It also comes at a time when the much larger and established US solar market has encountered headwinds.