Spreads on the iTraxx Crossover index broke through a downside barrier last week to set new series tights. Crossover spreads dipped to 232 basis points Tuesday, the previous series tight set in early November, and plummeted to 227 bps Wednesday. Traders had been testing the psychological barrier all week and broke through after the U.S. Federal Reserve decided to hold rates. "The Street pounded through that easily and no one was going to stand in the way," said one credit derivatives trader. The Crossover was trading between 228 bps and 230 bps Thursday and traders said it had strong support at 229 bps.
Crossover Plummets To Record Tights
