Interest rate spreads in the US High Yield bond market have risen recently after narrowing some 130 basis points since the beginning of the year.  While that is a concern, we point out that current readings are still below trend.  Comments from Pres. Trump over the weekend regarding tariff increases in trade negotiations with China have rattled stock and credit markets around the world and undoubtedly contributed to the near-term widening of US High Yield spreads.  How these negotiations play out towards the end of the week are critical for the capital markets. Key components of the earlier discussions – intellectual property protection, dispute resolution enforcement and freer market access – may be in jeopardy or be diluted. That could lead to economic disruption and derail the recovery in risk asset classes we have experienced so far this year.