Elevated volatility, driven by escalating tensions regarding Iran, pushed asset prices lower in March. Fixed income markets in the US and Canada experienced sharply rising rates and widening credit spreads as the situation in the Middle East continued to unfold.

The silver lining, however, is that pockets of relative value are beginning to emerge amid the dislocation. We are seeing notable spread widening in companies that appear to have been disproportionately punished. For example, short-dated CAD telecommunications credit repriced more than the broader Canadian short-dated corporate bond market, potentially creating attractive opportunities with all-in yields and spread valuations in this space.