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U.S. Treasury yields declined across the curve as markets priced in an increased likelihood of Federal Reserve rate cuts, triggering a rally especially in front-end tenors with 2Y yields dropping notably. The 10Y yield hovered near 4.0%, reflecting cautious optimism amid mixed economic signals. Investment grade corporate spreads widened modestly by approximately 3bp to 85bp, the widest since mid-year, despite solid fund inflows and strong demand for new issuance averaging 4x oversubscription. High yield spreads also widened by about 10bp, underperforming similar-duration UST by roughly 33bp, amid outflows from loan and HY funds totaling over $400M. MBS spreads tightened, supported by low volatility and the potential for UST curve steepening. Emerging market credit continued to outperform developed markets, with spreads tightening further despite a backdrop of potential dollar softness. Overall, credit markets remain supported by solid technicals and improving fundamentals, yet cautiousness prevails due to increasing late-cycle risks and select issuer stresses, particularly in lower-quality segments. The outlook suggests ongoing volatility with potential spread widening in credit, balanced by expected central bank easing and steady demand for safe-haven and yield assets.