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Borrowing Cheap in Europe Comes With Catch for U.S. Firms

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For the horde of U.S. companies chasing record-low borrowing costs in Europe, the debt isn’t as cheap as it looks.

As issuers from Kinder Morgan Inc. to Priceline Group Inc. sell 34 billion euros ($36.8 billion) of bonds as average yields slip below 1 percent, derivatives traders are extracting bigger fees to swap the interest payments into dollars. The cost to do that for five years has more than doubled since December, increasing to the most since 2012, according to prices compiled by Bloomberg.