Preqin Quarterly Updates 2023: Private Debt

The difficult macroeconomic environment that investors endured throughout 2022 has abated slightly. In the fourth quarter, we saw the return of some optimism, with risk assets rallying broadly and rebounding from the year’s lows. The S&P 500 was up by 7.1% in the final quarter, while the MSCI World Index increased by 9.8%.[1] Credit spreads tightened as the effective yield on high-yield bonds fell by around 60 basis points (bps) in the US.[2] Yet the yield curve is still inverted, with the 2s10s spread at -53bps as of December 31, 2022.[3] Continued easing of credit conditions could provide a tailwind to risk assets, including debt and private debt.