Rare bond market signal, not seen since 1998, re-emerged in August 2025 with LQD breaking past resistance. US investment-grade corporate bonds and Treasury yields spread has fallen to 75 basis points, lowest since June 2008. Market showing extreme confidence in corporate debt, with no extra premium needed to buy compared to risk-free Treasuries. Corporate America taking full advantage. Investment-grade credit spread narrowing, making borrowing cheaper for companies despite elevated interest rates. Wall Street favoring corporate debt currently.

In mid-August 2025, a significant bond market indicator resurfaced, last observed in 1998 prior to a major US bull market. The LQD is surpassing resistance levels, indicating positive market sentiment. Currently, the spread between US investment-grade corporate bonds and Treasury yields stands at 75 basis points, the lowest recorded since June 2008. This suggests minimal additional compensation is sought by investors for corporate debt over risk-free Treasuries. This illustrates high confidence in the repayment capacity of US corporations, leading to increased corporate borrowing. By demanding almost no extra premium, the market indicates strong faith in corporate America. The narrowing investment-grade credit spread signifies improved financial conditions, reducing borrowing costs for companies despite prevailing high interest rates. This emerging trend suggests a positive outlook towards corporate debt among investors and financial institutions. For more details, visit Benzinga.com.