SFA Research Corner: Recalibrating Through Tariff Squalls

Asset-backed commercial paper (ABCP) and term asset-backed securitization (ABS) markets have not been immune from tariff-related volatility. ABCP spreads inched wider as investor demand shifted toward shorter-dated, floating-rate paper. In term ABS, spreads have widened, creating more attractive entry points for investors. While tariffs have weighed on economic outlooks and introduced pressure on credit fundamentals, data suggests that consumer health remains solid and securitization structures remain resilient heading into this period of heightened uncertainty.