American firms have reportedly issued record volumes of debt in what analysts say is an attempt to get ahead of potential event risks in the near future.
Data from the London Stock Exchange Group (LSEG) shows 29 investment grade bond deals were issued on one day in the first week of September, which is the highest ever recorded, the Financial Times reports.
The day after the all-time record, another $73 billion in debt was issued, the largest in 20 years, according to LSEG.
The debt deals are sprawling across multiple business sectors, with massive issuances coming from Ford Motor Credit, Target, Uber and more.
While early September is typically a busy time for corporate borrowing, senior debt bankers say that the record-breaking week was likely due to the upcoming election and other geopolitical risks.
Says Dan Mead head of Bank of America Securities’ investment-grade syndicate,
“Issuers [are] pulling forward issuance in an effort to de-risk ahead of potential event risks out there, including upcoming economic data reports, the Fed’s decision on rates, the election and ongoing geopolitical risk while navigating blackout periods.”
Maureen O’Connor, Wells Fargo’s global head of investment-grade syndicate, says firms are hedging against the risk of recession.
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