As uncertainty around U.S. trade policy continues to shape the landscape for risk assets, a complex picture emerges for investment grade credit in 2025—but what does the future hold?

As investors wait for additional clarity on trade and fiscal policy, we offer six themes we think will drive fixed income markets in the second half of the year.

The economy’s impressive resilience has helped markets shake off fiscal and geopolitical uncertainties. But while it’s business as usual for some sectors, others are facing a panoply of new challenges, compounded by the accelerating AI revolution. Our experts take a look at how to play this complex new landscape.

Markets are holding steady despite mounting uncertainty, as investors, the Fed, and corporate America wait for clarity on fiscal policy and the direction of the economy.

We are closely monitoring developments, but our base case is a minimal economic impact, especially with the Fed able to support growth with rate cuts.

Reproduced with permission from AllianzGI

Reproduced with permission from AllianzGI

Even as markets cheer easing trade tensions, the effects of tariff uncertainty may still show up in economic data—and bring renewed volatility with them.

Over the last 35-plus years, U.S. convertibles have produced equity-like performance but with lower volatility. And thanks to accelerated new issuance at favorable terms, today’s opportunity set has expanded, adding to the appeal of this unique asset class.

Reproduced with permission from AllianzGI