Good morning

Market conditions continue to appear calm on the surface, but underlying constraints remain active beneath headline stability.

TODAY’S ONE THING
Periods of apparent calm are often when behaviour quietly tightens, well before it shows up in pricing.

What’s happening:
Volatility has compressed across several key indicators.
Pricing dispersion has narrowed, signalling more uniform risk assessment.
Credit appetite remains selective rather than expansive.

Why it matters:
When markets look settled, decision-makers often relax too early. In practice, this is frequently the phase where discretion becomes more important, approvals become more conditional, and outcomes start to diverge beneath stable headlines. Recognising this pattern helps avoid mistaking calm for improvement.

MICRO METRIC OF THE DAY
Credit spread dispersion:
Narrower than recent averages, indicating limited differentiation in current risk appetite.

Why it matters:
Compressed dispersion suggests consistency rather than confidence. In these conditions, results are shaped less by market movement and more by judgement, structure, and timing.

That’s what matters.