ICE BofA 1-3 Year US Corporate Index Option-Adjusted Spread
This dataset tracks ice bofa 1-3 year us corporate index option-adjusted spread over time.
Latest Value
0.50
Year-over-Year Change
0.00%
Date Range
12/31/1996 - 8/6/2025
Summary
The ICE BofA 1-3 Year US Corporate Index Option-Adjusted Spread measures the average difference in yield between corporate bonds and comparable U.S. Treasury securities. This metric provides critical insight into corporate credit risk and market sentiment across short-term corporate debt instruments.
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 represents the additional compensation investors require for holding corporate bonds versus risk-free government securities in the 1-3 year maturity range. Economists and financial analysts use this indicator to assess corporate credit conditions, market stress, and potential economic risks.
Methodology
The spread is calculated by comparing the option-adjusted yield of investment-grade corporate bonds to U.S. Treasury securities with similar maturities, accounting for embedded options and structural differences.
Historical Context
Central banks, investment managers, and policymakers monitor this spread as a key indicator of corporate financial health and potential economic turbulence.
Key Facts
- Measures credit risk for 1-3 year corporate bonds
- Wider spreads indicate higher perceived corporate credit risk
- Important leading indicator of economic conditions
FAQs
Q: What does a rising corporate bond spread indicate?
A: A rising spread typically suggests increased market uncertainty and higher perceived corporate credit risk. Investors demand more compensation for holding corporate debt during periods of economic stress.
Q: How do investors use this spread?
A: Investors use this spread to assess relative value in corporate bonds and gauge overall market sentiment. It helps in making investment allocation and risk management decisions.
Q: How is the option-adjustment calculated?
A: Option-adjustment accounts for embedded call or put options in corporate bonds, providing a more accurate representation of yield differences by standardizing potential early redemption scenarios.
Q: What makes the 1-3 year range significant?
A: The 1-3 year range captures short-term corporate credit conditions, offering a timely snapshot of corporate financial health and near-term economic expectations.
Q: How frequently is this data updated?
A: The ICE BofA Corporate Index is typically updated daily, providing real-time insights into corporate bond market conditions.
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Citation
U.S. Federal Reserve, ICE BofA 1-3 Year US Corporate Index Option-Adjusted Spread [BAMLC1A0C13Y], retrieved from FRED.
Last Checked: 8/1/2025