A strong trend for US businesses to issue Euro bonds

Companies are increasingly on their way to Europe to raise money at a low cost, a transformation that represents a qualitative shift in the short term in the US business’s debt market. This week, the company “Verizon Communications” sold debt of two billion euros ($ 2.31 billion), in its first agreement in the European market since early 2024. Earlier in July, FedEx Corp. and “Pepsico” (Pepsico) issued debt in the Unified Currency the euro region, in their first two proposals since 2021. Yanks’, which is 4.4 billion euros as the annual record with about five months at the end of the year. Some companies, such as “FedEx” and “Pepsico”, are financeing their business debt in euros, but the total number is for a good reason higher: the European central bank is conducting active interest rates amid low inflationary pressure, while the United States has not reduced interest rates. “From the view of the export party, borrowing is borrowed in the euro cheaper,” says Gordon Shannon, the Tuyfour asset management, “from the view of the export party, is the euro -loan cheaper,” says Gordon Shannon, Tuentive Asset Management. The blurring of US interest is increasing in US interest rates in the coming months. A report released on Friday indicates a sharp slowdown in the growth of work over the past three months and the high unemployment rate, suggesting that the labor market is heading for slowdown, enabling the Federal Reserve to lower interest rates. Also read: For the fifth time. The federal keeps the benefit unchanged and ignores Trump’s pressure, the yields of the US Treasury effects have decreased, but it reached the levels of the beginning of July. Even with market movements on Friday, loans in Europe are still cheaper. For lenders using hedging, this dynamics can change in the coming days. Nevertheless, it is likely that the transformation of companies over time to more mortgage in Europe, according to Hans Meksen, is the US credit strategy at TD Securities of the Toronto-Dominion Bank. During an interview, Mekken said that the United States that continue to impose more customs duties on other countries, including the new fees announced on Thursday, foreign investors, a ‘natural behavior’, tends to buy fewer ties of US businesses, and prefer the debt of companies denominated in the euro. Low demand will result in companies wherever they are looking for investors. “This is a somewhat long structural development because we will see more US businesses on our way to other markets,” Meccsen said during the interview. He continued, “the demand for US businesses will decline, while it will increase on the effects of non -American companies, and US businesses will still have to issue debt. Which is essential to realize the need to raise financing from other currencies.” It is a dislike of issuing debt in dollars and in addition to US businesses that want to borrow in the euro, European businesses are increasingly avoiding loans in dollars. In July, the release of the reverse Yankee reached about $ 9 billion, compared to an average of $ 3 billion a month during the past three years, according to Michelson. On the other hand, European companies borrowed slightly more than two billion dollars in July, compared to an average of $ 13 billion a month over the past three years. You may also be interested in: The US deficit is changing investors from government bonds to corporate debt, Mekken has written that these transformations to European publications declare the reason for the decline in US dollar bonds of the expectations of the Wall Street traders last month. Traders expected a $ 100 billion sales for July, while actual sales are approximately $ 81 billion, according to the data collected by Bloomberg. In the short term, any worker can reduce the volume of the sale, known as the technical factor, can help maintain relatively close differences in high quality mortgage prices. At the same time, the question, which is also a technical factor, is still strong, with the flow of cash liquidity to credit funds. The debt of US businesses currently has a series of pressure in the face, but the evaluations during the past week were at their strongest levels this year, as price differences reached only 0.76 degrees Celsius when they were closed on Thursday. “If we take this comprehensive direction to reduce the net offer, and banks issue fewer quantities due to the predictions of organizational reform, such as in the past quarter, and the increase in the number of US businesses issued in Europe, it leads to the improvement of positive technical factors in the US market,” says John Servedia, worldwide participant at JP Morgan.