Economics
Fed to Stay Full Throttle With Credit Support Despite Debt Rally
- No shift expected even amid better-than-expected May jobs
- Worry over persistent unemployment, slow U.S. growth to linger
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The Federal Reserve may have stoked one of the strongest corporate debt market rallies in decades, but it’s too soon to declare an all-clear for credit with the economy facing a potentially rocky road ahead.
Sure, U.S. investment-grade borrowing costs have retreated to near all-time lows, and companies have sold $1 trillion of bonds at the fastest pace on record -- evidence that merely announcing a plan to pump liquidity into corporate debt markets has helped ease strains before barely a dollar of central bank money was deployed.