Recession risks appear extremely low when looking at at two major forces at play for S&P 500 companies.
But rather than demand more compensation to finance the borrowing spree, investors have been snapping up new investment-grade bonds at some of the lowest spread levels since the global financial crisis.
Spreads were last pegged at about 92 basis points above Treasurys, only 4 basis points off the lows of 2024 set in May, according to BofA Global. That’s nearing the post-global financial crisis lows of 80 basis points set in the summer of 2021, when the Federal Reserve’s policy rate was still in a 0%-0.25% range.
