Consumer Confidence

• Consumer confidence fell from 98.4 in May to 93 in June, driven by concerns over inflation caused by recent tariff activity

• The expectations index, which reflects consumers’ beliefs about the economic outlook in six months, dropped from 73.6 in May to 69.0 in June. Sustained readings below 80 may signal a recession
• That being said, the consumer sentiment index, published by the University of Michigan, rose from 52.2 in May to 60.7 in June—the first increase in six months

PCE Index‍

• The PCE index rose 0.1% in May, marking the third consecutive month the index increased by 0.1% or less. The twelve-month rate of inflation ticked up from 2.2% in April to 2.3% in May

• The core rate of inflation increased by 0.2% in May. The yearly rate of core inflation rose from 2.6% to 2.7%
• Despite the modest upticks in inflation, the Federal Reserve is expecting U.S. tariffs to negatively impact these metrics in the near future

Existing Home Sales

• Sales of existing homes increased by 0.8% from April to May, reaching a 4.03 million seasonally adjusted pace
• The home-sales pace for May was the lowest since 2009, driven by affordability concerns among buyers
• Still, the news exceeded expectations of economists polled by Dow Jones Newswires and the Wall Street Journal, who forecasted home sales to fall to a 3.95 million pace in May

U.S. Tariff & Trade‍

• President Trump abruptly ended trade negotiations with Canada after Canada implemented a 3% digital services tax on U.S. tech firms retroactive to 2022, calling it a “blatant attack” and pledging new Canadian tariffs within a week
• Treasury Secretary Scott Bessent stated the U.S. anticipates finalizing 10 additional trade agreements by Labor Day, with active negotiations underway with Japan, South Korea, Vietnam, and possibly a standalone EU deal by mid-July
• President Trump announced the U.S. and China have signed a truce-style trade framework, formalizing earlier negotiations from Geneva and London, with expected tariffs of 30% on Chinese goods and 10% on U.S. goods—though specific terms remain unconfirmed
• President Trump said he would issue formal tariff notices within 10 days to countries not engaged in trade talks, detailing higher tariff rates that will take effect when the 90-day reciprocal pause expires on July 9
• Year-to-date, the U.S. has collected $96.2 billion in gross tariffs and excise taxes in 2025—$50.3 billion more than during the same period in 2024.

Jobless Claims

• Initial jobless claims, a measure of how many workers were laid off across the U.S., decreased to 236,000 in the week ended June 20, down 10,000 from the prior week.
• The four-week moving average was 245,500, down 750 from the prior week.
• Continuing claims – those filed by workers unemployed for longer than a week – increased by 37,000 to 1.974 million in the week ended June 13. This figure is reported with a one-week lag.

Fed’s Balance Sheet

• The Federal Reserves assets totaled $6.662 trillion in the week ended June 27, down $18.9 billion from the prior week.
• Treasury holdings totaled $4.212 trillion, up $0.1 billion from the prior week.
• Holdings of mortgage-backed securities (MBS) were $2.15 trillion in the week, down $5.2 billion from the prior week.

Total Public Debt

• Total public debt outstanding was $36.22 trillion as of June 27, an increase of 4.0% from the previous year.
• Debt held by the public was $28.89 trillion, and intragovernmental holdings were $7.26 trillion.

GDP

• The latest annualized U.S GDP stands at $29.96 trillion as of March 31, 2025 an increase of 0.80% from the previous quarter , & an increase of 4.67% from the previous year
• The total public debt-to-GDP ratio is at 120.87% as of March 31, an increase of 0.04% from the previous year

Inflation Factors

CPI:

• The consumer-price index rose 2.4% in May year over year.
• On a monthly basis, the CPI increased 0.1% in May on a seasonally adjusted basis, after increasing 0.2% in April.
• The index for all items less food and energy (core CPI) rose 0.1% in May, after rising 0.2% in April.
• Core CPI increased 2.8% for the 12 months ending May.

Food & Beverages:

• The food at home index increased 2.3% in May from the same month a year earlier, and increased 0.3% in May month over month.
• The food away from home index increased 3.8% in May from the same month a year earlier, and increased 0.3% in May month over month.

Commodities:

• The energy commodities index decreased (2.4%) in May after decreasing (0.2%) in April.
• The energy commodities index fell (11.6%) over the last 12 months.
• The energy services index rose 0.8% in May after increasing 0.6% in April.
• The energy services index rose 6.8% over the last 12 months.
• The gasoline index fell (12.0%) over the last 12 months.
• The fuel oil index fell (8.6%) over the last 12 months.
• The index for electricity rose 4.5% over the last 12 months.
• The index for natural gas rose 15.3% over the last 12 months.

Supply Chain:

• Drewry’s composite World Container Index decreased to $2,982.62 per 40ft container for the week of June 27
• Drewry’s composite World Container Index has decreased by (43.9%) over the last 12 months.

Housing Market:

• The shelter index increased 0.3% in May after increasing 0.3% in April.
• The rent index increased 0.3% in May after increasing 0.4% in April.
• The index for lodging away from home increased 1.9% in May after increasing 2.0% in April.

Federal Funds Rate

• The effective Federal Funds Rate is at 4.33%, flat 0.00% year to date.

Middle East

• A preliminary intelligence report found that U.S. strikes against Iran set back its nuclear program by a few months, contradicting statements by the Trump administration that the facilities were destroyed
• Iran launched missiles at a U.S. military base in Qatar on Monday, in retaliation for American strikes against Iran’s nuclear infrastructure. Iranian officials gave warning of the attack ahead of time, to minimize casualties. U.S. officials reported that all missiles were intercepted, and there were no injuries or deaths
• Israel and Iran agreed to a ceasefire early last week. As a result, Israel said it was lifting restrictions on civilian movement and economic activity. The complete terms of the ceasefire have not been disclosed
• President Trump said he abandoned plans to lift sanctions against Iran, following statements from Supreme Leader Ayatollah Ali Khamenei claiming victory over Israel

Europe

• NATO members agreed to ramp up defense spending at NATO’s summit in the Netherlands last week. Member countries will target defense spending equal to 3.5% of gross domestic product by 2035 
• The change in policy comes at President Trump’s insistence, who has threatened to disengage from NATO should European allies and Canada not increase their commitments
• During the summit, Russia was singled out as the center of “profound security threats and challenges” facing NATO
• Conflict in the Middle East pushed Spain’s and France’s inflation higher for the first time in 2025. The ECB announced that it expects the reduction of oil and gas traversing the Straight of Hormuz to have an overall negative impact on European economic growth this year

China

• Beijing recently reinvigorated discussions over Power of Siberia 2, a pipeline project that would supply Russian natural gas to China. Chinese authorities aim to diversify their energy imports in light of geopolitical uncertainty in the Middle East
• The two countries have disagreed over ownership of the project and gas pricing. If the project is approved, it will take approximately 5 years to build the 1,800-mile-long gas link
• Western companies, such as Ford, say that they are not receiving rare-earth magnets in sufficient quantities, despite promises from China that it would ease restrictions on its exports. In addition, applications to purchase rare earths are being rejected at higher volumes than historically 
• In response, China pledged on Friday to approve more applications for rare earths to the U.S., getting ahead of an issue that could rekindle trade tensions between the U.S. and China

Taiwan

• Taiwan is accelerating its efforts to develop a high-tech fleet of naval drones, which would be used to protect the island against Chinese aggression. Some military planners are calling the sea drone technology a “game-changer” for Taiwan’s defense capability

Vietnam

• Vietnam’s parliament voted to remove the death penalty for Truong My Lan, who was convicted in a highly publicized fraud case involving tens of billions of dollars

U.K.

• Amid rising regional tensions following U.S. strikes on Iran, the UK government is arranging a charter flight to evacuate vulnerable British nationals and their dependents from Israel, prioritizing those in need and warning that conditions may change rapidly

Canada

• In response to U.S. tariffs and foreign dumping concerns, Canada is considering mandating the use of domestic steel and aluminum in government infrastructure and defense projects to protect jobs and support long-term industry demand

Niger

• Over 200 gunmen on motorbikes attacked a Nigerien army base near Mali’s border, killing at least 34 soldiers; the assault underscores ongoing security failures and rising militant violence despite Niger’s pivot from Western alliances to partnerships with Russia and Turkey

India

• India's Aircraft Accident Investigation Bureau is weighing whether to send the black boxes from last week's Air India Boeing 787 crash overseas for decoding, after initial reports suggested fire damage may hamper domestic analysis. The crash killed at least 270 people

New Zealand

• Wellington has frozen NZ$18.2 million in funding after the Cook Islands signed wide-ranging agreements with China without prior consultation. The move signals rising tensions over Beijing’s growing influence in the Pacific and tests the traditionally close ties between the two nations

Spain

• Embattled by multiple graft probes implicating close allies and family, Prime Minister Pedro Sánchez has refused to step down, vowing to complete his term despite mounting pressure from an energized opposition and a fractured political base

Pakistan

• Islamabad credited former President Trump with brokering a ceasefire between India and Pakistan and announced plans to nominate him for the Nobel Peace Prize—despite India’s denial of any U.S. mediation in the conflict

Oil Prices

• WTI: $65.52 per barrel
  
• (12.56%) WoW; (8.64%) YTD; (19.01%) YoY
• Brent: $67.77 per barrel
  
• (12.00%) WoW; (9.20%) YTD; (20.50%) YoY

US Production

• U.S. oil production amounted to 13.4 million bpd for the week ended June 20, up 0.0 million
  bpd from the prior week.

Rig Count

• The total number of oil rigs amounted to 547, down 7 from last week.

Inventories

Crude Oil

• Total U.S. crude oil inventories now amount to 415.1 million barrels, down (7.5%) YoY.
• Refiners operated at a capacity utilization rate of 94.7% for the week, up from 93.2%
  in the prior week.
• U.S. crude oil imports now amount to 5.504 million barrels per day, down (9.2%) YoY.

Gasoline

• Retail average regular gasoline prices amounted to $3.19 per gallon in the week of
  June 27, down (8.6%) YoY.
• Gasoline prices on the East Coast amounted to $3.18, down (8.4%) YoY.
• Gasoline prices in the Midwest amounted to $3.17, down (6.9%) YoY.
• Gasoline prices on the Gulf Coast amounted to $2.94 down (5.5%) YoY.
• Gasoline prices in the Rocky Mountain region amounted to $3.30, down (3.2%) YoY.
• Gasoline prices on the West Coast amounted to $4.30, down (2.3%) YoY.
• Motor gasoline inventories were down by 2.1 million barrels from the prior week.
• Motor gasoline inventories amounted to 227.9 million barrels, down (1.6%) YoY.
• Production of motor gasoline averaged 10.11 million bpd, up 0.5% YoY.
• Demand for motor gasoline amounted to 9.688 million bpd, up 2.8% YoY.

Distillates

• Distillate inventories decreased by -4.1 million in the week of June 27
• Total distillate inventories amounted to 105.3 million barrels, down (12.0%).
• Distillate production averaged 4.789 million bpd, down (6.2%) YoY.
• Demand for distillates averaged 3.794 million bpd in the week, up 2.1% YoY.

Natural Gas

• Natural gas inventories increased by 96 billion cubic feet last week.
• Total natural gas inventories now amount to 2,898 billion cubic feet, down (7.5%) YoY.

High-yield:

High yield bond yields decreased 24bps to 7.14% and spreads decreased 5bps to 336bps. Leveraged loan yields decreased 31bps to 8.01% and spreads decreased 8bps to 463bps. WTD Leveraged loan returns were positive 35bps. WTD high yield bond returns were positive 91bps. 10yr treasury yields decreased 14bps to 4.25%. High-yield bonds posted their best weekly performance in two months, supported by the largest fund inflows in 18 months, as easing Middle East tensions, dovish Fed signals, and mixed macro data boosted sentiment. Leveraged loans also saw their strongest rally in six weeks, driven by improved risk appetite, steady retail inflows, active capital markets, and resilient CLO origination.

Week ended 06/27/2025

Yields & Spreads¹

Pricing & Returns¹

Fund Flows²

New Issue²

Distressed Level (trading in excess of 1,000 bps)²

Total HY Defaults

Leveraged loans:

Week ended 06/27/2025

Yields & Spreads¹

Leveraged Loan Index¹

Fund Flows²

New Issue²

Distressed Level (loan price below $80)¹

Total HY Defaults

Default activity:

• Most recent defaults include: Everstream ($495mn, 5/28/2025), At Home ($1.6bn, 5/15/2025), and Aegis Toxicology ($164mn, 5/9/2025), Ascend Performance Materials ($1.0bn, 4/21/2025), Sunnova ($800mn, 4/1/2025), Astra Acquisition ($1.0bn, 3/10/2025), Mitel Networks ($900mn, 3/9/2025), and Rugs USA ($486mn, 3/3/2025).

CLOs:

Week ended 06/27/2025

• New U.S. CLO Issuance²

• New U.S. CLO Issuance²

Note:High-yield and leveraged loan yields and spreads are swap-adjusted

¹ Source: Credit Suisse High Yield and Leveraged Loan Index
² Source: JP Morgan

Ratings activity:

• S&P and Moody’s High Yield Ratings

Appendix:

Diagram A: Leveraged Loan Trading Levels

Diagram B: High Yield and Leveraged Loan LTM Price

Diagram C: Leveraged Loan and High Yield Returns

Diagram J: New Issue - Leveraged Loan and High Yield

Diagram K: Leveraged Loan + HY Defaults by Sector – LTM

‍Diagram L: CLO Economics

Diagram M: Developed Country Govt. Bond Yields (%)

Diagram N: S&P 500 Historical Multiples

Diagram O: U.S. Middle-Market M&A Valuations (EV/EBITDA)

Diagram P: U.S. Large Cap M&A Valuations (EV/EBITDA)

Diagram Q: Dry Powder for All Private Equity Buyouts

Diagram R: Structured Credit Spreads

Diagram S: Structured Credit Yield

Diagram T: SOFR CURVE

Diagram U: CMBS Spreads

Freight Rates

Drewry World Container Index

‍

China-Global & Shanghai Export Container Freight Index

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