Credit Risk for Europe Bonds Soars in Longest Streak Since 2015
- Credit default swaps on junk debt set for sixth week of gains
- Demand for European debt wanes amid bets of an ECB rate hike
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European credit markets were rocked by the European Central Bank’s pivot toward tightening and an increase in the Bank of England’s main rate, putting indexes of risk on course for their longest streak of weekly gains in almost seven years.
The cost of insuring junk-rated bonds climbed 29 basis points this week as of 4:59 p.m. in London, the most since November, while a similar measure for investment-grade debt rose six basis points, according to Markit gauges. The indexes were on course for their sixth week of gains, the longest run since June 2015.