US Dollar Credit Supply: Primary Market Shows Strong Start to 2026
•February 13, 2026
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Why It Matters
The surge in TMT and bank issuance signals strong demand for USD‑denominated credit, while the anticipated reverse Yankee volume could reshape cross‑currency financing dynamics and pressure European markets.
Key Takeaways
- •TMT issuance $24bn, half of corporate supply.
- •Reverse Yankee forecast €120bn for 2026.
- •Banks issued $134bn, senior non‑preferred bonds lead.
- •USD spreads tight, may delay reverse Yankee issuance.
- •Consumer, healthcare, others saw no issuance in January.
Pulse Analysis
The early‑year momentum in the US dollar primary market reflects a broader shift toward technology‑driven financing. TMT issuers alone accounted for nearly half of January’s $56 bn corporate supply, highlighting the sector’s appetite for cheap USD funding as interest rates remain favorable. This concentration not only boosts overall market liquidity but also sets a benchmark for pricing that other industries will likely follow as the year progresses.
Reverse Yankee issuance, where European issuers tap the US market, is poised for a historic €120 bn in 2026. While January’s €4 bn start appears modest, analysts expect a surge as firms seek to exploit the lingering spread advantage between USD and EUR. However, tightening USD spreads could temper this enthusiasm, prompting issuers to prioritize domestic dollar deals before turning to the reverse Yankee route. The interplay of currency differentials and cost‑saving incentives will be a key driver of cross‑border credit flows.
Bankers have also marked a strong entry, delivering $134 bn of senior non‑preferred bonds—up $20 bn year‑to‑date versus 2024. This surge underscores banks’ confidence in investor appetite for higher‑yielding instruments amid a still‑robust credit market. Conversely, sectors such as consumer, healthcare and others remained dormant, suggesting a selective issuance landscape. As the year unfolds, monitoring spread dynamics, sector participation, and the pace of reverse Yankee activity will be essential for investors and issuers navigating the evolving USD credit environment.
US Dollar Credit Supply: Primary market shows strong start to 2026
Executive Summary
Strong TMT issuance drives the supply seen in January
Corporate supply in January totalled US $56 bn, in line with that of last year. TMT dominated issuance with US $24 bn, accounting for nearly half of all corporate supply for the month.
This outsized contribution continues the recent pattern in which large US tech companies have been driving a substantial share of USD supply, consistent with the heavy TMT issuance observed throughout late‑2025.
Autos (US $5.4 bn), Industrials (US $6.4 bn), Real Estate (US $1.4 bn), Utilities (US $11.5 bn), and Oil and Gas (US $7 bn) were the other active sectors, while Consumer, Healthcare and Others saw no issuance at all, echoing a quiet start typically seen in these segments.
Reverse Yankee supply set for a big year
Reverse Yankee supply was also decent with €4 bn coming to the market. While January is normally a little quieter for Reverse Yankee supply given the US earnings period, we are expecting a notable pick‑up in February and into March.
However, in saying that, the initial wave we were expecting around February might underwhelm. With USD spreads now very tight, it may make more sense for issuers to do the USD deals they have planned first, then come with Reverse Yankees later. The expensive USD spreads are already beginning to reverse now with EUR once again outperforming, but the cost saving is not as attractive as it was previously. We do expect a further USD underperformance and opening back up of the differential.
We forecast a record‑breaking €120 bn for corporate reverse Yankee supply in 2026, as there is still a lot of financing that needs to get done and the cost‑saving advantage will offer opportunities, not to mention the rush of the US tech issuers coming to the EUR market. We feel the €120 bn won’t put too much pressure on the market and shouldn’t crowd out European issuers. For now, the demand for credit is still very strong, and there is plenty of cash to be put to work.
Banks showed a strong start to 2026
Banks were particularly active on the USD primary market in January with $134 bn printed, the bulk of this in senior non‑preferred bonds. This is a $20 bn increase compared to 2024 YTD. The start of the year was less impressive for the insurance sector (stable YoY) and other financials (with supply halved YoY).
All in all, net issuances remain positive for financials at $63 bn. The bank‑related numbers shown in this report may vary from previous publications as we have updated our data provider and now include all USD‑denominated issuances.
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