Last week’s disappointing employment report was another brushback pitch to the Fed as it hopes to hike rates sometime this summer. While some economists worried that diminished job creation could foretell a slowing in US GDP, others pointed to real wage growth, better consuming spending, and improved housing starts.

We have noted before the Fed’s inclination to talk itself out of normalizing interest rates when exogenous events rear their ugly heads. Certainly the looming Brexit referendum on June 23rd qualifies; Chairperson Yellen has now identified it as a potential risk ahead of the Fed’s meeting later this month.

This seesaw dynamic has caused investors in private credit and equity to worry less about rate policy and more about returns. As three-month Libor crept up to 0.66% from 0.37% last November, large cap double-B issuers have seen 75 bps subsidies fall away. With actual Libor near the floors, and strong corporate credits few and far between, investors are willing to see (for example) Yum! Brands lose the floor from its $2 billion TLB. Its L+300 bps spread was also cut to 275.

No sign of floors going anywhere for single-B leveraged loans; average Libor subsidies remain around 100 bps. Broadly syndicated spreads have settled in the 5.50-5.75% context, as institutional funds put cash to work against a strengthening, but still modest, deal pipeline.