Looking back at the last rate hike cycle (2015-2018), credit spreads for both high yield and investment grade bonds (see blue line) were not immediately negatively affected when the Fed rates started to take off. However, the more mature the economic cycle became, the stronger the negative effect was, as reflected in the widening of spreads in 2018 and the corresponding negative market reaction. What can we expect from the current credit cycle? While there are some similarities, such as the fact that we are dealing with inflation worries, there are also many differences, most notably supply chain disruptions, pent-up consumer demand and fiscal support that is likely to stretch the current economic cycle. However, while the exact experience may not repeat itself, it will certainly rhyme.