Rates on U.S. high-yield corporate bonds fell below 7 percent for the first time last week, according to Bank of America Merrill Lynch index data.
Average borrowing costs for speculative-grade companies from Sprint Nextel Corp. (S:US) to HCA Holdings Inc. (HCA:US) dropped to an unprecedented 6.965 percent Sept. 14 from 7.07 percent the day earlier, Bank of America Merrill Lynch’s U.S. High Yield Master II index data shows. The gauge was at 8.54 percent at year-end and 8.79 percent a year ago, the index data show.
Junk bonds, or high-yield, high-risk securities, are rated below Baa3 by Moody’s Investors Service and BBB- at Standard & Poor’s.
To contact the reporter on this story: Charles Mead in New York at firstname.lastname@example.org
To contact the editor responsible for this story: Alan Goldstein at email@example.com