ICE BofA 7-10 Year US Corporate Index Option-Adjusted Spread
This dataset tracks ice bofa 7-10 year us corporate index option-adjusted spread over time.
Latest Value
0.96
Year-over-Year Change
0.00%
Date Range
12/31/1996 - 8/7/2025
Summary
The ICE BofA 7-10 Year US Corporate Index Option-Adjusted Spread measures the average yield difference between corporate bonds and Treasury securities in the 7-10 year maturity range. This metric provides critical insights into corporate credit risk and market sentiment by indicating the additional compensation investors require for holding corporate debt versus risk-free government securities.
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 credit risk premium for mid-term corporate bonds, reflecting market perceptions of corporate financial health and economic stability. Economists and investors closely monitor this indicator as a barometer of corporate financial conditions and potential economic stress.
Methodology
The spread is calculated by comparing the yield of a basket of 7-10 year corporate bonds against comparable Treasury securities, with statistical adjustments for embedded options.
Historical Context
Central banks, financial analysts, and policymakers use this spread to assess corporate credit conditions and potential economic turning points.
Key Facts
- Wider spreads indicate higher perceived corporate credit risk
- Typically used for intermediate-term (7-10 year) corporate bonds
- Reflects market expectations about corporate financial health
FAQs
Q: What does a rising corporate bond spread mean?
A: A rising spread suggests increasing market concerns about corporate creditworthiness and potential economic challenges. Investors demand higher compensation for perceived higher risk.
Q: How often is this index updated?
A: The ICE BofA Corporate Bond Index is typically updated daily, providing real-time insights into corporate credit market conditions.
Q: Why are option-adjusted spreads important?
A: Option-adjusted spreads account for embedded options in bonds, providing a more accurate representation of true credit risk compared to simple yield differences.
Q: How do investors use this spread?
A: Investors use this spread to assess relative value in corporate bonds, evaluate credit risk, and make informed investment decisions across different market conditions.
Q: What are the limitations of this indicator?
A: The spread represents an average across corporate bonds and may not capture nuanced risks of individual companies or specific sectors.
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Citation
U.S. Federal Reserve, ICE BofA 7-10 Year US Corporate Index Option-Adjusted Spread [BAMLC4A0C710Y], retrieved from FRED.
Last Checked: 8/1/2025