Valentine Ainouz
Valentine Ainouz
Head of Global Fixed Income Strategy, Amundi Investment Institute
Sandrine Rougeron
Sandrine Rougeron
Global Head of Corporate and Corporate Pension Funds Clients, Amundi

In a nutshell

For 2025:

Euro credit markets are posting a third consecutive year of strong performance. In 2025, Investment Grade  (IG)  and,  notably,  High  Yield  (HY)  bonds outperformed government bonds, with excess yield versus sovereign debt of 3.5% for Euro HY and 2.3% for Euro IG.

Primary corporate debt issuance reached record levels in 2025 across both the Investment Grade and High Yield segments. At the same time, demand remained  robust  as  investors  sought  to  capture attractive yields.

Despite slowing growth, corporate fundamentals remained solid. Over recent years issuers have managed their balance sheets prudently, and the strong primary market activity allowed them to anticipate refinancing needs effectively. 12 month expected default rates for European High Yield remain contained at 2–3%, with most defaults concentrated in the lowest-rated names.

 

For 2026:

The economic environment remains favorable to credit markets. We expect growth of around 2% in the United States and a stabilization near 1% in the euro area. We anticipate the Fed will continue its rate-cutting cycle, with a terminal rate near 3.25%. The ECB currently keeps rates at 2% but retains room to act if growth or inflation weaken too much in 2026.

Solid fundamentals and strong investor demand should continue to support the asset class: demand for corporate bonds is expected to remain high given attractive yields relative to money-market rates. As a reference, current yields are approximately 3.2% for Euro IG and 5.1% for Euro HY, well above their historical averages and offering a meaningful pick-up versus money market.

Primary market Investment Grade

Composite of four line charts comparing Euro investment‑grade A and BBB markets across tenors (1–3yr, 3–5yr, 5–7yr, 7–10yr, 10+yr). Top row: Euro IG A OAS (bps) and yield (%) with three dated series; bottom row: Euro IG BBB OAS and yield showing parallel widening and rising trends across maturities. Source: Bloomberg, Amundi.

Market data

Multi‑panel dashboard of Euro IG primary market metrics as of 30 Nov 2025: monthly issuance bars with annotated monthly highs, cumulative flows line chart with yearly series (2014–2025), Euro HY cumulative issuance, monthly volume by maturity buckets, monthly volume by rating (AAA–BBB) and monthly volume by country, enabling issuance, flow and composition analysis.

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