Euro Credit Market Views € - October 2026

Valentine Ainouz

CFA - Head of Global Fixed Income Strategy, Amundi Investment Institute

Sandrine Rougeron

Global Head of Corporate and Corporate Pension Funds Clients, Amundi

In a nutshell

September marked the end of a longue phase of spread tightening. In recent weeks, credit spreads have widened across the euro and dollar markets:

Euro investment grade: +25 bp in September, peaking at 100 bp at month-end. Since the start of October, spreads have come back to around 93 bp.
Euro high yield: spreads moved from 260 bp end of August to around 330 bp. CCC-rated issuers clearly underperformed.
US investment grade: spreads are trading in a 75-85 bp range.
US high yield: widening at the end of September, from 265 bp to around 330 bp. Here too, CCC issuers underperformed.

Three factors mainly explain this widening:

Tensions in sovereign yields spilled over into credit (September). Since the end of June, global bond yields have risen sharply, driven by higher energy prices, resilient growth and a rising term premium. Indeed, investors are demanding more yield to buy the long end of the curves, reflecting fiscal concerns, the recurrence of exogenous shocks, and increased competition for capital from AI-related investment. The September increase is explained more by the term premium. Rising yields are increasingly testing fiscal constraints, which leaves France particularly exposed.
Record euro primary issuance (September). US issuers issued heavily in euros, and European high yield set a new single-day issuance record on September 16.
Doubts over the AI trade (end of September): skepticism briefly resurfaced over whether mega-cap tech companies can generate adequate returns relative to their massive capital expenditure

Overall, this move reflects geopolitical tensions and interest rate volatility more than any real deterioration in corporate fundamentals. The rise in yields since mid-year has considerably increased the appeal of carry assets. Even though very long-dated yields may remain volatile through year-end, several market segments offer attractive yields. This is notably the case for investment-grade credit.

Primary market Investment Grade

Six-panel dashboard on Euro investment-grade and high-yield primary markets, showing monthly issuance, cumulative monthly issuance, cumulative flows, and monthly volume by maturity, rating and country, with multi-year bar and line charts through September 2026.

Market data

Four-panel credit dashboard for Euro IG A and BBB bonds, comparing OAS and yield curves across maturities from 1-3yr to 10+yr on 24-Mar-23, 31-Jul-26 and 25-Sep-26, highlighting spread compression for A and higher yields for BBB.

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