Run-it-Hot Eurozone Economy Robs Junk Bond Market of Real Yield
- Inflation-adjusted return on euro junk negative for first time
- Second-best global bond performance threatened by price growth
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Europe’s economy is getting too hot for its credit market.
Inflation-adjusted yields on junk-rated debt have turned negative for the first time ever after euro-area consumer prices jumped to a decade-high in August, leaving fund managers to worry about not just the risk of default but also price growth.