The economic re-opening is fueling a credit rating rebound among American companies — and those companies are tapping bond markets to take advantage of it.
U.S. corporations saw harsh downgrades in their credit ratings during the depths of the COVID-19 pandemic, as a drying up in financial markets sparked concern of a wave of bankruptcies and defaults.
A safety net from the Federal Reserve helped prevent those corporate collapses from happening, and a faster-than-expected economic recovery is now boosting company earnings.
BofA Global Research noted that upgrades have been running at a record pace for investment grade corporates, the catch-all credit rating bucket for companies not rated as junk (or “high yield”).
Across the three major ratings agencies (Moody’s, S&P, and Fitch), BofA calculated that net upgrades were…