Retail Sales

• Retail sales were flat in December, capping a softer fourth quarter after strong spring and summer spending as consumers front-ran tariff-driven price increases 
• Sales rose 3.8% year over year, with gains concentrated at home centers (+1.2%), while car dealers, clothing stores, electronics retailers and restaurants saw declines
• The slowdown suggests consumers may be growing more cautious, particularly middle- and lower-income households that pulled holiday spending forward earlier in the year

Unemployment Rate

• The U.S. added 130,000 jobs in January, the largest monthly gain in 13 months and well above expectations for 55,000, while the unemployment rate fell to 4.3%
• Hiring patterns were likely distorted by seasonal factors, but the report suggests the labor market has stabilized after last year’s slowdown
• The data are unlikely to shift Fed policy, allowing officials to remain focused on combating stubborn inflation

Consumer Price Index

• Consumer prices rose 0.2% in January, below expectations, while annual inflation slowed to 2.4% from 2.7% at the end of 2025
• Core CPI increased 0.3% on the month, with the 12-month core rate easing to 2.5%, the lowest level since early 2021
• If the cooling trend continues, it could open the door to Fed rate cuts later this year, though economists caution January data may understate underlying inflation

U.S. Tariff & Trade

• The U.S. and Taiwan finalized their trade deal that confirms a 15 % U.S. tariff rate on Taiwanese imports while Taiwan cuts or eliminates tariffs on most U.S. goods. Taiwan also pledged substantial purchases of U.S. LNG, crude, aircraft, and industrial equipment, and major investment in U.S. semiconductor/AI sectors under the pact
• The Trump administration is reportedly considering trimming the scope of existing steel and aluminum tariffs (currently ~50 %); although details and timing are unclear, the reported rollback plans caused shares of US steelmakers and aluminum producers to sink this week
• US Congress increased tariff activity this week, with a bipartisan House vote opposing Canada tariffs and the Senate introducing the Last Sale Valuation Act to eliminate the first sale valuation rule, a change that would increase dutiable value and raise effective tariff costs for importers if enacted
• Bangladesh finalized an agreement with the U.S. lowering its tariff rate to 19% on general exports and granting duty-free access for select apparel made with U.S. materials, a first reciprocal deal of this type in South Asia

Jobless Claims

• Initial jobless claims, a measure of how many workers were laid off across the U.S., decreased to 227,000 in the week ended February 6, down 5,000 from the prior week.
• The four-week moving average was 219,500 up 7,000 from the prior week.
• Continuing claims - those filed by workers unemployed for longer than a week - increased at 1.862 million in the week ended January 30. This figure is reported with a one-week lag.

Fed’s Balance Sheet

• The Federal Reserve's assets totaled $6.622 trillion in the week ended February 13, up $16.5 billion from the prior week.
• Treasury holdings totaled $4.290 trillion, up $15.6 billion from the prior week.
• Holdings of mortgage-backed securities (MBS) were $2.02 trillion in the week, down $6.9 billion from the prior week.

Total Public Debt

• Total public debt outstanding was $38.65 trillion as of February 13, an increase of 6.7% from the previous year.
• Debt held by the public was $31.03 trillion, and intragovernmental holdings were $7.60 trillion

GDP

• The latest annualized U.S. GDP stands at $31.10 trillion as of September 30, 2025, an increase of 2.01% from the previous quarter , & an increase of 5.38% from the previous year
• The total public debt-to-GDP ratio is at 121.03% as of September 30, an increase of 0.86% from the previous year

Inflation Factors

CPI:

• The consumer price index rose 2.7% in December year over year.
• On a monthly basis, the CPI increased 0.3% in December on a seasonally adjusted basis, after increasing 0.3% in November.
• The index for all items less food and energy (core CPI) rose 0.2% in December, after rising 0.2% in November.
• Core CPI increased 2.6% for the 12 months ending December.

Food & Beverages

• The food at home index increased 2.3% in December from the same month a year earlier and increased 0.6% in December month over month.
• The food away from home index increased 4.1% in December from the same month a year earlier and increased 0.7% in December month over month.

Commodities

• The energy commodities index decreased (0.3%) in December after increasing 1.3% in November.
• The energy commodities index fell (2.9%) over the last 12 months.
• The energy services index rose 1.1% in December after increasing 0.1% in November.
• The energy services index rose 7.7% over the last 12 months.
• The gasoline index fell (3.4%) over the last 12 months.
• The fuel oil index rose 7.4% over the last 12 months.
• The index for electricity rose 6.7% over the last 12 months.
• The index for natural gas rose 10.8% over the last 12 months.

Supply Chain

• Drewry’s composite World Container Index decreased to $1,932.58 per 40ft container for the week of February 13.
• Drewry’s composite World Container Index has decreased by (37.6%) over the last 12 months.

Housing Market

• The shelter index increased 0.4% in December after increasing 0.2% in November.
• The rent index increased 0.4% in December after increasing 0.2% in November.
• The index for lodging away from home increased 1.2% in December after decreasing (8.2%) in November.

Federal Funds Rate

• The effective Federal Funds Rate is at 3.64%, flat 0.00% year to date

Middle East

• The Pentagon is deploying the USS Gerald R. Ford, the Navy’s largest aircraft carrier, to the Middle East, where it will join the USS Abraham Lincoln and nine other U.S. warships
• The move comes as Washington increases pressure on Iran over its nuclear program, while signaling openness to a deal to avoid military action, and follows additional deployments of aircraft and air-defense systems to the region
• Violence in Gaza surged in January despite the October cease-fire, with more than 370 Israeli strikes recorded as both Israel and Hamas accused each other of violations
• The renewed fighting has stalled the next phase of the U.S.-brokered peace plan, as Hamas refuses to disarm, Israel maintains strict security control, and plans for new governance lag

Europe

• At the Munich Security Conference, Marco Rubio framed Washington’s tougher tone toward Europe as “tough love,” urging allies to shoulder more defense responsibility while reaffirming U.S. commitment to NATO
• He sought to ease concerns over tariffs and Ukraine, arguing the trans-Atlantic alliance remains intact, though unease persists among European leaders
• Bank of Russia cut its key interest rate to 15.5% from 16%, its sixth straight reduction, signaling further easing may follow as inflation cools and growth slows
• Russia’s economy expanded just 1% in 2025 (down from 4.9% in 2024) as war costs and sanctions weigh on activity; with Urals crude around $45 per barrel – well below budget breakeven – monetary policy is expected to remain tight despite gradual rate cuts

China

• The U.S. plans to deploy up to four nuclear-powered submarines to a base in Western Australia beginning in 2027, deepening military integration with Australia under the pact to deter China
• The base would serve as a backup to Guam in a Taiwan conflict, offering maintenance and repair capacity closer to potential flashpoints in the South China Sea and Taiwan Strait
• China’s consumer inflation slowed sharply in January, with CPI rising just 0.2% year-over-year, down from 0.8% in December, as food prices fell
• Producer prices remained in deflation for a 40th straight month, down 1.4% from a year earlier, underscoring persistent excess supply and weak demand in the manufacturing sector

Venezuela

• The U.S. issued a broad license allowing major global energy companies to resume and expand oil and gas investments in Venezuela following reforms to its hydrocarbon law, with revenues structured through U.S.-supervised channels

Japan

• Prime Minster Sanae Takaichi won a landslide victory in parliamentary elections, securing a two-thirds majority in the lower house

Cuba

• Cuba’s President Miguel Diaz-Canel said his government is willing to engage with the Trump administration. The announcement comes during the country’s worst crisis since the fall of the Soviet Union

Egypt

• The Rafah border between Egypt and Gaza reopened, allowing limited two-way traffic. Israel proposed allowing 150 Palestinians to leave and 50 to enter the checkpoint daily

Russia

• Lt. Gen. Vladimir Alekseyev, deputy head of Russia’s GRU intelligence agency, was shot multiple times while in Moscow

Canada

• President Donald Trump threatened to ground Canadian-made aircrafts and impose tariffs on Canadian imports after Canada delayed certification of U.S.-made Gulfstream jets, escalating trade tensions between Washington and Ottawa

Taiwan

• Taiwan pledged $250 billion to stand up semiconductor factories in the United States. In exchange, the U.S. agreed to cut tariffs on Taiwanese goods from 20% to 15%

Israel

• Israel formally recognized Somaliland to gain intelligence cooperation and secure strategic Red Sea shipping lanes near the Bab al-Mandab Strait, marking a bold diplomatic move that expands its influence into the Horn of Africa despite international condemnation

Oil Prices

• WTI: $62.85 per barrel
• (1.10%) WoW; (11.39%) YTD; (11.94%) YoY
• Brent: $67.69 per barrel
• (0.53%) WoW; (8.83%) YTD; (9.77%) YoY

US Production

• U.S. oil production amounted to 13.7 million bpd for the week ended February 6, up 0.0 million bpd from the prior week.

Rig Count

• The total number of oil rigs amounted to 551, flat from last week.

Inventories

Crude Oil

• Total U.S. crude oil inventories now amount to 428.8 million barrels, down (0.8%) YoY
• Refiners operated at a capacity utilization rate of 89.4% for the week, down from 90.5% in the prior week
• U.S. crude oil imports now amount to 6.201 million barrels per day, down 16.9% YoY

Gasoline

• Retail average regular gasoline prices amounted to $2.94 per gallon in the week of February 13, down (7.0%) YoY
• Gasoline prices on the East Coast amounted to $2.94, down (7.1%) YoY
• Gasoline prices in the Midwest amounted to $2.77, down (9.5%) YoY
• Gasoline prices on the Gulf Coast amounted to $2.57, down (7.7%) YoY
• Gasoline prices in the Rocky Mountain region amounted to $2.80, down (10.9%) YoY
• Gasoline prices on the West Coast amounted to $4.08, down (2.3%) YoY
• Motor gasoline inventories were up by 1.2 million barrels from the prior week
• Motor gasoline inventories amounted to 259.1 million barrels, up 4.5% YoY
• Production of motor gasoline averaged 9.15 million bpd, down (0.5%) YoY
• Demand for motor gasoline amounted to 8.300 million bpd, up 0.7% YoY

Distillates

• Distillate inventories decreased by -2.7 million in the week of February 13
• Total distillate inventories amounted to 124.7 million barrels, up 6.9% YoY
• Distillate production averaged 4.859 million bpd, up 2.9% YoY
• Demand for distillates averaged 4.449 million bpd in the week, up 1.9% YoY

Natural Gas

• Natural gas inventories decreased by 249 billion cubic feet last week
• Total natural gas inventories now amount to 2,214 billion cubic feet, up 5.4% YoY

High-yield:

High yield bond yields decreased 6bps to 6.74% and spreads tightened 2bps to 315bps. Leveraged loan yields decreased 5bps to 8.16% while spreads were unchanged at 491bps. WTD high yield bond returns were positive 22bps. WTD leveraged loan returns were positive 12bps. 10yr treasury yields decreased 11bps to 4.10%. High yield and leveraged loans gained modestly this week, despite underperformance in lower-rated credits and widening in AI-sensitive sectors such as software and insurance brokers amid ongoing disruption concerns.

Week ended 02/13/2026

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 02/13/2026

Yields & Spreads¹

Pricing & Returns¹

Fund Flows²

New Issue²

Distressed Level (loan price below $80)¹

Total Leveraged Loan Defaults

Default activity: 

• Most recent defaults include: Multi-Color ($4.5bn, 01/29/2026), Pretium Packaging ($201mn, 01/28/2026), Saks Global Enterprises ($2.7bn, 12/30/2025), United Site Services ($2.6bn, 11/30/2025), New Fortress Energy ($3.5bn, 11/15/2025), Packers Sanitation Services ($1.2bn, 11/5/2025), Office Properties Trust ($1.7bn, 10/31/25), GPS Hospitality ($400mn, 10/30/25), Jordan Health Services ($1.0bn, 10/15/25), and Astra Acquisition ($1bn, 9/30/25).

CLOs: 

Week ended 02/13/2026

New U.S. CLO Issuance²

New U.S. CLO YTD 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

Source: Bloomberg

Appendix:

Diagram A: Leveraged Loan Trading Levels

Source: Credit Suisse Leveraged Loan Index

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 

Source: JP Morgan Default Monitor

Diagram L: CLO Economics 

Source: JPM and BBG

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

Diagram N: S&P 500 Historical Multiples

Source: S&P Capital IQ

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

Source: Pitchbook

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

Source: Pitchbook

Diagram Q: Dry Powder for All Private Equity Buyouts ($B)

Diagram R: Dry Powder for All US Debt ($B)

Diagram S: Structured Credit Spreads

Source: Bloomberg

Diagram T: Structured Credit Yield

Source: Bloomberg

Diagram U: SOFR Curve

Diagram V: CMBS Spreads 

Source: Bloomberg

ZCGC Real Estate

• Big Tech is rapidly shifting capital allocation away from shareholder returns and toward AI infrastructure investment.
• Combined buybacks by Amazon, Alphabet, Microsoft, Meta, and Oracle fell to $12.6B in Q4 2025, the lowest since 2018 and down 74% from the ~$48B peak in 2021.
• Amazon has not repurchased shares since Q2 2022, while Meta and Alphabet have sharply reduced buybacks versus prior years.
• At the same time, combined CapEx from Amazon, Alphabet, Microsoft, and Meta is projected to reach ~$610B in 2026, up roughly 70% YoY.
• This spending level is nearly 3x 2024 CapEx and over 4x 2023 levels, reflecting an unprecedented infrastructure buildout cycle.
• Amazon, Alphabet, Meta, and Microsoft are each on track to set new records for annual corporate CapEx, underscoring the scale of the AI investment race.

Freight Rates

Drewry World Container Index

China-Global & Shanghai Export Container Freight Index