AI Debt Binge Is Set to Test Credit’s 1990s-Like Euphoria

Credit investors who shrugged off an historic bout of global volatility this week are about to face a major test after yield premiums on US investment-grade corporate debt shrunk to their lowest in about three decades.

Spreads, or the extra yield above Treasuries that investors demand for owning the high-quality company debt, tightened to just 71 basis points, according to Bloomberg index data. That marks the lowest for the measure since 1998.