Report5 October 2022Updated one month ago

US Dollar Credit Supply: Low supply in September

USD supply was low in September. Corporate supply is now US$140bn lower than last year YTD, while financials are running slightly ahead of last year YTD

Executive summary

Corporate supply totals US$42bn in September, down on previous years

Corporate supply in September amounted to US$42bn, significantly lower than the US$75bn+ seen in previous years. On a YTD basis, supply is now pencilled in at US$440bn, down US$140bn from US$584bn by this time last year. Redemptions were US$40bn for the month of September, resulting in a net supply of US$1.6bn. Redemptions in October are set to be USD$32bn.

The Consumer sector had the most supply last month, with US$15bn followed by the Industrial sector with US$12bn. In terms of YTD supply, the Consumer sector totalled US$46bn, but TMT remains the highest amongst all sectors with a figure of US$114bn. Until now, only the Autos sector is on the positive side in terms of difference from last year’s YTD figures with a 37% increase from US$19bn last year to US$26bn thus far this year.

Corporate Reverse Yankee supply is now at €25bn YTD, after €4bn was issued in September. This is significantly lower than previous years. Limited primary market activity due to the volatile markets and higher funding costs has resulted in supply to be concentrated in local currency, thus relatively lower Reverse Yankee supply.

Negative net supply for Financials in September

Financial credit supply saw a substantial drop in September, decreasing from US$62bn in August to US$17bn. Additionally, this is the lowest amount of this year and for August in the past four years by a considerable amount. Redemptions were high in September at US$30bn, putting net supply at -US$13bn, the lowest level this year. Financial credit supply is now sitting at US$449bn YTD, up slightly on previous years.  

Naturally bank supply accounted for most of the financial credit supply where Bank senior supply accounted for US$9bn this month and US$4bn in Bank capital supply this month.