U.S. News

• U.S. Unemployment

• • • The unemployment rate rose to 4.1%, an increase from 4.0% and higher than forecasts
    • Employment trended upward in healthcare, financial activities, transportation and warehousing, and social assistance. Federal government employment trended downward
    • Nonfarm payroll employment rose by 151,000 in February, more than in January but below the forecasted 170,000 figure

• Factory Orders

• • • New orders for manufactured goods in January increased $9.8 billion, or 1.7%, to $589.9 billion
    • Shipments increased $2.4 billion, or 0.4%, to $592.1 billion, marking the third consecutive monthly increase
    • Unfilled orders increased $2.7 billion, or 0.2%, to $1,400.6 billion. This follows a 0.3% decrease in December
    • Inventories increased $0.8 billion, or 0.1%, to $863.7 billion, marking the third consecutive monthly increase

• Auto Sales

• • • New light-vehicle sales in February reached 16.0 million units, a year over year increase of 2.1% and above the forecasted 15.5 million units
    • Hybrids continue to increase their market share, as sales reached 274,189 units in February, an incrase of 38.6% year over year. Sales of electric vehicles have also risen year over year, up to 185,922, which is an 18.8% increase
    • Industry experts predict that higher vehicle costs, driven by interest rates and tariffs, pose a near-term challenge for the industry

• U.S. Tariff & Trade

• • • President Trump announced a one-month tariff exemption for goods qualifying under the United States–Mexico–Canada Agreement (USMCA). This granted a reprieve for 62% of Canadian and 51% of Mexican goods imported into the U.S.
    • Canadian Prime Minister Justin Trudeau responded to the U.S. tariffs by announcing that Canada will impose a 25% tariff on C$155 billion worth of U.S. imports in two phases and will remain in place until the U.S. removes its tariffs
    • Effective March 10, China will impose additional tariffs of 15% on chicken, wheat, corn, and cotton, as well as 10% on sorghum, soybeans, pork, beef, aquatic products, fruits, vegetables, and dairy products imported from the U.S.
    • On March 1, President Trump issued an executive order directing the Department of Commerce to initiate a Section 232 investigation into the national security impact of importing timber, lumber, and their derivative products, such as paper products, furniture, and cabinetry

  Target Country	Current US Tariffs	Goods Targeted	Effective Date	Tariff %
  China	Sec 301 China Origin Tariffs	Most goods	7/16/2018	Most goods are subject to tariffs ranging from 27.5% to 45%, with select goods facing tariffs as high as 100%
  	4 Year Review of Sec 301	A select number of goods such as electric vehicles, batteries, syringes, medical gloves, and solar cells	9/27/2024
  	JEEPA China Tariff	All goods of Chinese origin	2/1/2025
  Canada	IEEPA Canada Tariff	All goods, except USMCA qualifying goods that have been granted exemption until April 2nd	3/4/2025	25%, except for Canadian energy products, which are subject to a 10% tariff
  Mexico	IEEPA Mexico Tariff	All goods, except USMCA qualifying goods that have been granted exemption until April 2nd	3/4/2025	25%
  All Countries	Sec 232 Steel / Aluminum & Derivatives	Steel, aluminum, and certain derivatives of steel and aluminum	3/12/2025	25%

  Target Country	Potential Tariff Action	Notes
  All Countries	Reciprocal Tariffs	Presidential memorandum on Feb 13th laid the groundwork for imposition of reciprocal tariffs on imports from individual countries with “unfair and unbalanced trade with the US.”
  All Countries	Semiconductors	President Trump stated tariffs on semiconductor chips would begin at “25% or higher” though no specific implementation date has been provided
  All Countries	Pharmaceuticals, Automobiles, Lumber, Copper	During a speech on February 19th, President Trump stated that tariffs on these products would be introduced “over the next month or sooner”
  All Countries	Retaliatory Tariffs	The Trump administration plans to impose tariffs or other measures against any foreign government that enforces a “fine, penalty, tax, or other burden” deemed discriminatory, disproportionate, or intended to extract substantial funds or intellectual property from American companies
  All Countries	Agricultural Products	On March 3, 2025, President Trump announced that new tariffs on imported agricultural products will take effect on April 2, 2025. He urged American farmers to increase domestic production in anticipation of these measures

• Jobless Claims

• • • Initial jobless claims, a measure of how many workers were laid off across the U.S., decreased
      to 221,000 in the week ended February 28, down 21,000 from the prior week.
    • The four-week moving average was 224,000, up 250 from the prior week.
    • Continuing claims – those filed by workers unemployed for longer than a week – increased by
      42,000 to 1.897 million in the week ended February 21. This figure is reported with a one-week
      lag.

• Fed’s Balance Sheet

• • • The Federal Reserve’s assets totaled $6.757 trillion in the week ended March 7, dpwn $9.3
      billion from the prior week.
    • Treasury holdings totaled $4.243 trillion, down $8.6 billion from the prior week.
    • Holdings of mortgage-backed securities (MBS) were $2.20 trillion in the week, down $14.3 billion
      from the prior week.

• Total Public Debt

• • • Total public debt outstanding was $36.22 trillion as of March 7, an increase of 5.1% from
      the previous year.
    • Debt held by the public was $28.91 trillion, and intragovernmental holdings were $7.30 trillion.

• GDP

• • • The latest annualized U.S GDP stands at $29.72 trillion as of December 31, an increase of 5.03%
      from the previous year
    • The total public debt-to-GDP ratio is at 121.87% as of December 31, an increase of 1.71% from
      the previous year

• Inflation Factors

• CPI:

• • • • The consumer-price index rose 3.0% in January year over year.
      • On a monthly basis, the CPI increased 0.5% in January on a seasonally adjusted basis,
        after increasing 0.4% in December.
      • The index for all items less food and energy (core CPI) rose 0.4% in January, after
        rising 0.2% in December.
      • Core CPI increased 3.3% for the 12 months ending January.

• Food & Beverages:

• • • • The food at home index increased 1.9% in January from the same month a year earlier,
        and increased 0.5% in January month over month.
      • The food away from home index increased 3.4% in January from the same month a year
        earlier, and increased 0.2% in January month over month.

• Commodities:

• • • • The energy commodities index increased 1.9% in January after increasing 3.9% in
      • The energy commodities index fell (0.5%) over the last 12 months.
      • The energy services index rose 1.8% in January after increasing 0.8% in December.
      • The energy services index rose 2.5% over the last 12 months.
      • The gasoline index fell (0.2%) over the last 12 months.
      • The fuel oil index fell (5.3%) over the last 12 months.
      • The index for electricity rose 1.9% over the last 12 months.
      • The index for natural gas rose 4.9% over the last 12 months.

• Supply Chain:

• • • • Drewry’s composite World Container Index decreased to $2,540.72 per 40ft
      • Drewry’s composite World Container Index has decreased by (22.7%) over the last 12
        months.

• Housing Market:

• • • • The shelter index increased 0.4% in January after increasing 0.3% in December.
      • The rent index increased 0.4% in January after increasing 0.3% in December.
      • The index for lodging away from home increased 3.9% in January after decreasing
        (2.1%) in December.

• Federal Funds Rate

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

World News

• Middle East

• • • After supporting the Assad regime, Russia is now coordinating with the new Syrian government to maintain its military bases and economic ties. Russia sent $23 million in Syrian currency last month to the central bank in Damascus. On top of this, private negotiations have included billions of dollars in cash and investments in gas fields and ports and a potential apology by Moscow for its role in bombing civilians
    • Syrian forces continue to combat ambushes by Assad loyalists, particularly along the country’s Mediterranean coast, the heartland of the Assad’s Alawite religious minority. Syrian officials stated that government forces have retaken control of Tartus and Latakia and were pursuing insurgents in Qardaha. Local reports indicate that government forces carried out beatings, arbitrary arrests, and lootings during their campaign
    • Israel drafted plans for escalatory pressure against Hamas, now that talks to extend the ceasefire have stalled. The first step was blocking the entry of goods into Gaza, which took effect last week. The next planned move would be to cut off electricity and water. Measures could escalate up to another invasion of Gaza, with the intention of occupying territory while Israel attacks the remnants of Hamas

• Europe

• • • President Trump ordered a pause to weapons shipments and intelligence sharing with Ukraine, after a contentious meeting between Trump and Ukrainian President Volodymyr Zelensky demonstrated the rift between the two leaders’ views on the road to peace. While Ukraine has enough weapons to continue fighting near-term, the Ukrainian military relies heavily on U.S. intelligence to conduct operations
    • On Tuesday, Zelensky posted on X that he would sign the mineral-rights deal, an agreement that was meant to be signed during Zelensky’s visit to the U.S. However, this has not been enough to resume U.S. support. According to a White House official, military aid and intelligence sharing will not resume until Trump believes that Zelensky is making a good-faith effort to negotiate for peace
    • Top U.S. officials will meet with Ukrainian counterparts in Saudi Arabia next week, with the goal of setting a framework for an initial ceasefire and peace agreement. Currently, there are no negotiations scheduled between Kyiv and Moscow

• China

• • • China set its 2025 growth target at 5%, unchanged from last year. China also stated that it met its 2024 growth target. To meet its 2025 goal, China will increase its fiscal deficit target to 4% of GDP, up from 3% last year. In addition, the inflation target dropped from 3% in 2024 to 2% in 2025. These targets will be challenged by trade tensions, weak domestic demand, and longstanding concerns over China’s property sector
    • China retaliated against recent U.S. tariffs with duties against American products and controls on U.S. companies. Beijing announced an additional 15% tariff on U.S. chicken, wheat, corn, and cotton products, and an additional 10% tariff on sorghum, soybeans, pork, beef, seafood, fruits, vegetables, and dairy products. These tariffs are scheduled to take effect on March 10
    • In addition, China added more than two dozen American companies to export control and corporate blacklists. China has also filed a lawsuit with the World Trade Organization against the U.S.’s new tariffs

• Canada

• • • Canadian Prime Minister Justin Trudeau said the new leader of the Liberal Party will transition to prime minister in the span of a week after the vote concludes on Sunday

• Germany

• • • Orders at German factories dropped by 7% in January, a larger decline than forecasted. The reduction of factory orders comes as Germany prepares for the impact of U.S. tariffs that will take effect in April

• South Korea

• • • South Korean jet fighters accidentally dropped eight bombs just outside Seoul, injuring at least 15 people and destroying buildings

• France

• • • French inflation cooled to its lowest level in four years, giving the European Central Bank further reason to cut interest rates. Consumer prices in France rose 0.9% in February, lower than the 1.5% forecasted by economists

• United Kingdom

• • • Prime Minister Keir Starmer met President Donald Trump in Washington, D.C. While no deal was signed, Trump said that there was “a very good chance” of a trade deal “where tariffs wouldn’t be necessary”

• Argentina

• • • Argentine President Javier Milei faces political backlash after a cryptocurrency he endorsed, $LIBRA, collapsed, wiping out $4 billion. Accused of promoting a scam, Milei denies involvement, calling it a private matter. A federal judge is investigating, while critics demand impeachment. The controversy threatens Milei’s credibility as he seeks U.S. support for economic reforms and an IMF loan

• Venezuela

• • • President Trump is planning to revoke a Biden-era license allowing Chevron to produce oil in Venezuela. Trump said that President Maduro’s failure to assist in deporting migrants led to the decision

• Australia

• • • Argentine Australia has passed a law banning social media access for under-16s, requiring platforms to implement age verification measures like facial recognition. While many parents and some experts support the move, others argue it may be ineffective, as children can find ways to bypass restrictions, and harmful content could shift to other online spaces

• Thailand

• • • Thailand estimates 30,000–100,000 people, including foreigners from 30+ countries, are trapped in Myanmar scam compounds run by Chinese gangs, forced into global fraud schemes. In response, Thailand cut power, restricted fuel, and is repatriating victims. The crackdown intensified after Chinese actor Wang Xing’s high-profile abduction exposed the region’s human trafficking crisis

• Mexico

• • • In response to the U.S. designating six Mexican drug cartels as foreign terrorist organizations, Mexico’s President Claudia Sheinbaum announced plans for constitutional reforms to protect national sovereignty, rejecting any U.S. military intervention while also proposing stricter penalties for foreign involvement in arms trafficking

Commodities

• Oil Prices

• • • WTI: $67.04 per barrel
      • (3.90%) WoW; (6.53%) YTD; (15.28%) YoY
    • Brent: $70.36 per barrel
      • (3.85%) WoW; (5.73%) YTD; (15.19%) YoY

• US Production

• • • U.S. oil production amounted to 13.5 million bpd for the week ended February 28, up 0.0 million
      bpd from the prior week.

• Rig Count

• • • The total number of oil rigs amounted to 592, down 1 from last week.

• Inventories

• • • Crude Oil

      • Total U.S. crude oil inventories now amount to 433.8 million barrels, down (3.3%) YoY.
      • Refiners operated at a capacity utilization rate of 85.9% for the week, down from 86.5%
        in the prior week.
      • U.S. crude oil imports now amount to 5.919 million barrels per day, down (19.5%) YoY.

    • Gasoline

      • Retail average regular gasoline prices amounted to $3.10 per gallon in the week of
        March 7, down (9.0%) YoY.
      • Gasoline prices on the East Coast amounted to $3.09, down (7.7%) YoY.
      • Gasoline prices in the Midwest amounted to $2.96, down (11.5%) YoY.
      • Gasoline prices on the Gulf Coast amounted to $2.74, down (10.0%) YoY.
      • Gasoline prices in the Rocky Mountain region amounted to $3.08, down (1.5%) YoY.
      • Gasoline prices on the West Coast amounted to $4.28, down (1.9%)
      • Motor gasoline inventories were down by 1.4 million barrels from the prior week.
      • Motor gasoline inventories amounted to 246.8 million barrels, up 3.0% YoY.
      • Production of motor gasoline averaged 9.63 million bpd, down 0.1% YoY.
      • Demand for motor gasoline amounted to 8.877 million bpd, down (1.5%) YoY.

    • Distillates

      • Distillate inventories decreased by -1.3 million in the week of March 7.
      • Total distillate inventories amounted to 119.2 million barrels, down (0.6%) YoY.
      • Distillate production averaged 4.575 million bpd, up 20.4% YoY.
      • Demand for distillates averaged 3.991 million bpd in the week, down (2.0%) YoY.

• Natural Gas

• • • Natural gas inventories decreased by 80 billion cubic feet last week.
    • Total natural gas inventories now amount to 1,760 billion cubic feet, down (24.6%) YoY.

Credit News

High yield bond yields increased 17bps to 7.29% and spreads increased 20bps to 325bps. Leveraged loan yields decreased 10bps to 8.47% and spreads decreased 4bps to 472bps. WTD high yield bond returns were negative 34bps and leveraged loan returns were negative 13bps. 10-year Treasury yield remained unchanged at 4.28%. High yield spreads widened as developing global trade war, rising growth concerns, and higher global bond yields continue to weigh on sentiment. Leveraged loan yields declined amid weaker data and recalibration of Fed expectations.

High-yield:

Week ended 03/07/2025

• Yields & Spreads¹
  
• Pricing & Returns¹
  
• Fund Flows²
  
• New Issue²
  
• Distressed Level (trading in excess of 1,000 bps)²
  
• Total HY Defaults
  

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

Leveraged loans:

Week ended 03/07/2025

• Yields & Spreads¹
  
• Leveraged Loan Index¹
  
• Fund Flows²
  
• New Issue²
  
• Distressed Level (loan price below $80)¹
  
• Total Loan Defaults
  

Default activity:

• Most recent defaults include: Aimbridge Hospitality ($1.1bn, 1/31/2025), Exela Intermediate LLC ($1.2bn, 1/15/2025), City Brewing ($886mn, 1/2/2025), The Container Store ($163mn, 12/22/2024), Party City ($264mn, 12/21/2024), Hearthside Food Solutions ($2.6bn, 11/22/24), Spirit Airlines ($1.1bn, 11/18/24), and Franchise Group Inc ($1.1bn, 11/3/24).

CLOs:

Week ended 03/07/2025

• 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

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: Leveraged Loan Defaults by Sector – Full Year

Diagram L: CLO Economics

Diagram N: Developed Country GovBond Yields (%)

Diagram O: S&P 500 Historical Multiples

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

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

Diagram R: Dry Powder for All Private Equity Buyouts

Diagram S: Structured Credit Spreads

Diagram T: Structured Credit Yield

Diagram U: SOFR CURVE

Diagram V: CMBS Spreads

Freight Rates

Drewry World Container Index

China-Global & Shanghai Export Container Freight Index