Global Credit Spreads Tighten to 2022 Low as Buyers Rush In.

Corporate bond investors are taking advantage of high yields by purchasing new issues worldwide, anticipating potential interest-rate cuts by major central banks. Yield premiums on bonds in the Bloomberg Global Credit Corporate index tightened to their lowest level since January 2022. This trend is driven by strong US economic growth in the fourth quarter and expectations of rate cuts by central banks, which would lower yields. However, caution is advised as defaults for weaker firms are increasing and developers in many countries are under pressure. [Extracted from the article]