The Credit Edge by Bloomberg Intelligence Barclays’ Rogoff Sees Risk of AI Bust as Debt Issuance Ramps Up
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Dec 4, 2025 Brad Rogoff, Global Head of Research at Barclays, shares insights on the potential risks in credit markets driven by an AI funding frenzy. He discusses how increased issuance may lead to vulnerabilities if expectations aren’t met. Rogoff emphasizes sector dynamics, encouraging caution around low-grade bonds while highlighting the importance of quality in portfolios. With a focus on 2026 forecasts, he predicts wider spreads but not an imminent recession, urging investors to remain vigilant amid evolving market conditions.
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Blend Data Signals With Analyst Research
- Combine systematic signals with analyst views to improve alpha.
- Overlay signals on analyst recommendations to filter bad trades and boost performance.
Liquidity Premium Has Eroded
- Improved market liquidity has eroded the historical liquidity premium in public credit.
- That reduction partly explains the shift of investors into private credit seeking higher illiquidity premia.
Base Case: Slow Positive Growth Helps Credit
- Barclays expects slow but positive growth and limited Treasury yield moves in 2026.
- That backdrop favors credit performance, and non-cyclicals may outperform cyclicals marginally.