What caused spread U-turn?

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Credit investors are trying to make sense of a sharp widening trend that began in early March. After month upon month of gradual tightening, the credit markets finally gave substantial ground, with the iBoxx index moving out from 35bp to 49bp. The question now facing investors is this: was March’s widening a technical blip, a market correction or a definitive turn in the credit cycle?

During February, it seemed as though the iBoxx index was entering a new range of 35–42bp. But the credit market h

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