While a near-term mechanical bounce in economic activity in response to the lifting or easing of lockdown measures looks likely, we expect the subsequent climb up to be long and arduous.

We expect the Federal Reserve will continue to conduct asset purchases at its current pace through year-end, and eventually commit to keeping interest rates on hold through 2022. This should help ensure easy financial conditions and support the economic recovery.

The coronavirus pandemic has brought about a new investment landscape in which some companies and sectors have fared better than others. Significant market dislocations have also created potential opportunities in the higher quality areas of the credit spectrum.