U.S. investment-grade bond issuance hits highest level since 2020, global bond market sees a record-breaking year

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The annual issuance of US investment-grade corporate bonds has reached $1.499 trillion, the second highest level in history, as companies take advantage of lower borrowing costs for debt refinancing, acquisition financing, and AI project investments.

According to Bloomberg compiled data, after four deals completed on Tuesday, the issuance of US investment-grade bonds this year has surpassed last year’s $1.496 trillion, though the volume is unlikely to reach the record $1.75 trillion set in 2020.

Although this year’s issuance has not reached the record $1.75 trillion high of 2020, strong investor demand and interest rate cuts by central banks around the world have created an extremely favorable market environment for borrowers.

This year, global bond issuance has surpassed the $6 trillion mark for the first time, setting a new historical high.

The pace of US investment-grade bond issuance has accelerated significantly recently, with October’s issuance setting a monthly record, partly owing to Meta’s $30 billion bond sale, the largest investment-grade bond deal in over two years.

Relative to US Treasury benchmark interest rates, borrowing costs for investment-grade bonds remain at historic lows.

As investors rush to lock in higher coupons before the Fed begins cutting interest rates, the average spread in the secondary market fell to 0.72 percentage points in September, the lowest since 1998.

About $1 trillion in bonds will mature in 2025, which has led Wall Street to anticipate an unusually active year for investment-grade bond issuance, as companies may need to refinance a large portion of maturing debt.

Wall Street dealers’ preliminary forecasts for 2026 indicate that the scale of investment-grade bond issuance will further increase compared to this year.

According to Bloomberg compiled data, about $1.1 trillion in high-rated bonds will mature next year. This data covers bonds with a composite Bloomberg investment-grade rating, or that have received an investment-grade rating from at least one of Moody’s, S&P Global, or Fitch.

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