Analysis: Corporate credit tremors in aftershock of tariff-led stock rout
The tariff shock and recession fears that have sent world stocks into a tailspin over the last week are rolling into corporate funding markets, raising the cost of borrowing and disrupting financing plans even for lower-risk companies. With U.S. Treasuries nursing huge losses on Wednesday - the strongest sign yet that stress is impacting so-called safe-haven assets - attention has now turned to the $35 trillion global corporate bond market, which has swelled by around 40% since 2008 as companies gorged on cheap debt, OECD data shows. The premium investors demand to hold low-rated corporate credit versus government debt has soared by 100 basis points in a week, the biggest short-term move in so-called global junk bond spreads since the U.S. regional banking crisis in March 2023.
