Latest / Stagflation Conversations with Fexingo: High Inflation, Slow Growth, and 1970s Echoes
Stagflation Is Reshaping Corporate Debt Markets
Lucas and Luna dive into how stagflation is transforming corporate debt markets in 2026. With CPI at 332.4 and real GDP growth stuck at 2.0%, companies are facing a double squeeze: rising borrowing costs and slowing demand. Lucas explains why investment-grade bond yields have surged to 6.5%, while junk bond spreads widen to levels not seen since 2020. They discuss how firms are pivoting from long-term fixed-rate bonds to shorter maturities and floating-rate notes, and why covenant-lite loans are becoming a thing of the past. Luna highlights a recent example: a major retailer that refinanced…
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