Fed rate hikes may be up for debate — but credit conditions are already tighter

Borrowing costs have risen since late February as bond yields climbed following the Iran conflict, and heavy financing needs for the AI buildout are adding to demand for capital. The dual impact of geopolitical-driven higher yields and large AI-related issuance is a headwind for borrowers and may keep rates elevated across credit and bond markets.

Analysis

Borrowing costs have risen since late February as bond yields climbed following the Iran conflict, and heavy financing needs for the AI buildout are adding to demand for capital. The dual impact of geopolitical-driven higher yields and large AI-related issuance is a headwind for borrowers and may keep rates elevated across credit and bond markets.