The speed and breadth of issuance this year is being driven by two factors: issuers are pouncing on demand from yield-focused investors plowing into the asset class. Finance chiefs are also eager to raise cash before the upcoming presidential election has the potential to inject volatility into the market.
Both Treasury yields and the average cost for blue-chip debt plunged in recent days, creating an additional opportunity for issuers to raise cash at cheaper levels. High-grade bond yields fell to 4.99% on Monday, hovering at the lowest since February 2023 after weak employment data sparked a stampede into Treasuries.
"If Treasury yields stay low, I think we are going to see issuance move forward even into a volatile market because financing costs are as attractive as they've been since early 2022 at this point," Blair Shwedo, head of fixed income sales and trading at U.S. Bank, said in an interview.
#corporate-bonds #market-volatility #financial-strategy #yield-focused-investors #presidential-election
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