Banks led the charge, with US financial institutions issuing 292% more than in the previous month and their European counterparts increasing their issuance by 72%, according to Moody’s Analytics.
Corporate bond issuance increased across the investment grade and high yield space, with “rest of world” registering the largest increase of all regions. Moody’s attributed the pace of activity to a fall in interest rates, following dovish comments from the US Federal Reserve and European Central Bank.
The report said: “The upward move in yields which started in the beginning of this year, has ceased, at least for now, and interest-rate volatility has begun to decline. Bank issuance has been positively correlated with periods of low interest rate volatility, thus with rates coming off it’s not surprising that US banks rushed back into the primary market last month.”
Despite a busy month in July, banks have accounted for a shrinking proportion of total bond issuance in recent years, falling from 60% in 2009 to 29% in June 2013.
