WS #15308
Credit markets are showing signs of strain as BofA reports a record $72 billion in M&A-driven issuance for September 2026, pushing investment-grade spreads to within 10bps of 2026 wides. High-yield bond spreads have hit pandemic-era highs, reflecting growing investor caution. This financial tightening coincides with the UK average five-year fixed mortgage rate hitting 6% for the first time in three years, underscoring the persistent burden of higher interest rates on consumers and the broader economy.
Credit Markets and Macro Stress
Credit markets are showing signs of strain as BofA reports a record $72 billion in M&A-driven issuance for September 2026, pushing investment-grade spreads to within 10bps of 2026 wides. High-yield bond spreads have hit pandemic-era highs, reflecting growing investor caution. This financial tightening coincides with the UK average five-year fixed mortgage rate hitting 6% for the first time in three years, underscoring the persistent burden of higher interest rates on consumers and the broader economy.