Investments

Citigroup Inc. is structuring the so-called collateralized fund obligation, which will include both debt and equity portions.

1988 Asset Management has priced and closed $2.5 billion in CLOs in the U.S., and the partnership expects to issue CLOs regularly in Europe.

The strategy, which focuses on non-bank lending to sectors such as residential mortgages, credit cards and auto loans, has been a key plank of the bond giant's push into private lending.

The US 10-year term premium — or the extra return investors demand to own longer-term debt instead of a series of shorter ones — has climbed to near 1%, a level last seen in 2014.

Bond yields are shooting up for the second time in as many months. Federal Reserve Gov. Christopher Waller attributes the volatility to concerns about rising national debt levels.

Early signs are emerging that Trump-induced dollar volatility, inflated Treasury yields and fears about the country's debt burden are fueling a gradual reweighting toward the Old Continent.

The alternative-asset manager also sees the risk of a "structurally" weaker dollar as President Donald Trump seeks to reshape global trade. The dollar is about 15% overvalued.

Moody's announced Friday evening it was downgrading the US to Aa1 from Aaa, reinforcing Wall Street's growing worries over the nation's fiscal outlook as Capitol Hill debates even more unfunded tax cuts.

Tariff impact on distressed companies could fuel LME increase

The market for estate loans packaged into debt slowed dramatically after the Federal Reserve sharply raised interest rates in 2022.