Yields Falling to ’04 Levels Spark Busiest July: Credit Markets
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U.S. corporate bond sales soared 31 percent this month, the busiest July on record, as yields fell to the lowest in more than six years on growing investor confidence in the economic recovery.
Issuance of $85.7 billion exceeded the previous high for the month of $71.1 billion set last year, according to data compiled by Bloomberg. The cost of borrowing fell to 5.04 percent, the lowest since April 2004, and down from the 2010 high of 5.75 percent on Jan. 4, according to Bank of America Merrill Lynch’s U.S. Corporate & High Yield index. That decline would save issuers about $7.1 million of interest per $1 billion of bonds.