US investment grade debt issuance has hit $1.7 trillion year to date (YTD) in 2025, a 12% increase year on year (YoY). That brings outstanding IG US debt to US$9.5 trillion, and 2025 now stands 18% higher than the five year, YTD average, according to MarketAxess data.
In Europe, EU IG debt issuance in 2025 reached €714 billion (+21% YoY) YTD which takes the level of outstanding IG debt to €3.1 trillion. That means 2025 issuance is 28% up on the five-year, YTD average.
The increase in issuance levels is not surprising with major central banks including the New York Federal Reserve and European Central Bank pivoting to rate cutting, with lower borrowing costs encouraging companies to issue debt, and lock in cheaper financing before rates potentially stabilise.
Companies refinancing debt issued during the higher-rate environment of 2022–2023. Bonds trading below par value offer issuers opportunities to restructure at more favourable terms, while investors benefit from the “pull to par” effect as bonds approach maturity.
There has also been no problem in finding buyers of debt – the concern around a toppy equity market, particularly in the US – has made secure debt more attractive compared to other asset classes for investors looking to hold existing gains. This demand has created favourable conditions for issuers to raise new capital, while credit conditions remain positive, outside of concerns in specific buckets such as private credit.
Consequently, despite the apparent pressure that increased issuance creates on investor appetite, the market conditions appear benign for the moment.
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