By enhancing liquidity and improving functionality in the corporate bond markets, new U.S. Federal Reserve (Fed) programs have been good news in the short term. Yet a number of unknowns remain regarding the rollout of these programs, and we foresee potentially challenging impacts for more highly levered companies over the longer term.
The Fed's Rapid and Aggressive Actions
The Fed has rapidly deployed its tools to improve liquidity and stabilize markets that were rocked by the economic impact of COVID-19.
The Fed's efforts, announced on March 23, included new programs that allowed the purchase of