Sovereign Credit Spread
Yield difference between US Treasuries and other sovereign bonds (or corporate bonds). Sensitivity to market credit risk.
Market Impact
RISING / BULLISH
(Widening) Risk-off. Capital flight from emerging markets or corporate default fears.
FALLING / BEARISH
(Narrowing) Risk-on. Improved global investment appetite. Inflow to high-yield assets.
Context 2026
With more nations holding massive debt, CDS (Credit Default Swaps) on US Treasuries themselves have become a new key indicator measuring eligibility as risk-free assets.
OmniMetric Relevance
Medium. Captures signs of systemic risk and calculates downside risk for the GMS Score.