Companies Go on Debt Binge Despite Rising Rates, Risking More Fed Hikes

Companies with investment-grade credit ratings have added over $500 billion in net debt since the first Fed rate hike in early 2022.

Even companies with poorer credit ratings have ramped up borrowing again in 2023 after scaling back in 2022.

The debt binge signals the Fed may need to keep pushing rates higher to curb corporate overspending.

Defaults have risen in some high-risk debt markets like real estate and retail.

Corporate borrowing remains high in North America while it has declined in Europe and Asia.