Near-term profit pressures on U.S. corporate borrowers look set to intensify, as many find it more difficult to deal with still-elevated input costs and waning demand amid the prospects of a downturn in the world’s largest economy and diminished consumer purchasing power. Benchmark borrowing costs will likely go higher still, as the Federal Reserve continues its fight against inflation. As borrowers face a prolonged period of elevated interest rates, concerns about liquidity are growing as the Fed withdraws monetary support at an unprecedented pace. Refinancing pressure is building. Corporate debt coming due rises steadily through 2026, and the share of speculative-grade maturities surpasses that of investment-grade in 2027. Faced with an overhang of pandemic-era debt that begins to mature in 2025, companies will soon look for refinancing opportunities.
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