S&P Global: Int'l Bond Issuance Growth to Slow toward 5% with Possibility of Contraction

Global bond issuance growth is expected to slow to around 5%, with the possibility of contraction if economic expansion remains overly concentrated in the technology sector amid rising geopolitical tensions, according to a new report by S&P Global Ratings.

In the report, a copy of which was obtained by Al Mal, the agency noted that global primary bond markets demonstrated notable resilience during the first quarter of the year despite early spring trade volatility, closing the period with growth of approximately 11%.

This performance, the agency said, reflects sustained investor appetite and the continued ability of corporations and sovereigns to access financing, even in an environment marked by heightened uncertainty.

Looking ahead, S&P Global Ratings expects issuance activity to remain supported through 2026, driven primarily by substantial upcoming debt maturities that will require refinancing. A rebound in mergers and acquisitions is also expected to bolster issuance volumes.

In a more optimistic scenario, additional upside could emerge from increased capital expenditure linked to artificial intelligence investments and data center expansion, potentially providing an extra boost to bond supply.

However, the agency cautioned that global economic growth is projected to moderate this year, while interest rates are likely to remain at historically elevated levels. These factors could temper issuance momentum and weigh on borrowing conditions.