ICE BofA BBB US Corporate Index Option-Adjusted Spread
This dataset tracks ice bofa bbb us corporate index option-adjusted spread over time.
Latest Value
1.01
Year-over-Year Change
1.00%
Date Range
12/31/1996 - 8/8/2025
Summary
The ICE BofA BBB US Corporate Index Option-Adjusted Spread measures the additional yield investors demand for holding BBB-rated corporate bonds compared to risk-free Treasury securities. This metric provides critical insight into corporate credit risk and overall market sentiment.
Analysis & Context
This economic indicator provides valuable insights into current market conditions and economic trends. The data is updated regularly by the Federal Reserve and represents one of the most reliable sources for economic analysis.
Understanding this metric helps economists, policymakers, and investors make informed decisions about economic conditions and future trends. The interactive chart above allows you to explore historical patterns and identify key trends over time.
About This Dataset
This spread reflects the perceived credit risk of BBB-rated corporate bonds, which are considered lower-medium investment grade. Economists and investors use this indicator to assess corporate financial health, market stress, and potential economic challenges.
Methodology
The spread is calculated by comparing the yield of BBB-rated corporate bonds to comparable U.S. Treasury securities, adjusted for embedded options and potential prepayment scenarios.
Historical Context
Policymakers and financial analysts use this spread as a key indicator of corporate credit conditions and potential economic downturn risks.
Key Facts
- BBB-rated bonds represent the lowest tier of investment-grade corporate debt
- Wider spreads indicate higher perceived credit risk in the corporate sector
- This metric is a leading indicator of potential economic stress
FAQs
Q: What does a rising BBB corporate bond spread indicate?
A: A rising spread typically suggests increasing market uncertainty and higher perceived credit risk for corporations.
Q: How do investors use this spread?
A: Investors use this spread to assess corporate credit conditions and make informed investment decisions about corporate bonds.
Q: What makes this index unique?
A: The option-adjusted methodology accounts for embedded options in bonds, providing a more nuanced view of credit spreads.
Q: How does this relate to economic health?
A: Widening spreads can signal potential economic challenges, such as increased default risk or economic slowdown.
Q: How often is this data updated?
A: The index is typically updated daily, providing real-time insights into corporate credit market conditions.
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Citation
U.S. Federal Reserve, ICE BofA BBB US Corporate Index Option-Adjusted Spread [BAMLC0A4CBBB], retrieved from FRED.
Last Checked: 8/1/2025