ICE BofA B & Lower US Emerging Markets Liquid Corporate Plus Index Option-Adjusted Spread
This dataset tracks ice bofa b & lower us emerging markets liquid corporate plus index option-adjusted spread over time.
Latest Value
4.76
Year-over-Year Change
-4.99%
Date Range
12/31/2003 - 8/5/2025
Summary
The ICE BofA B & Lower US Emerging Markets Liquid Corporate Plus Index Option-Adjusted Spread measures the credit risk premium for lower-rated corporate bonds in emerging markets. This metric provides critical insights into market perception of credit risk and overall economic health in developing economies.
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 index tracks the spread between emerging market corporate bonds rated B and lower versus risk-free benchmark rates, indicating investor sentiment about credit risk. Economists use this spread as a key indicator of financial market stress and potential economic volatility in emerging markets.
Methodology
The spread is calculated by comparing the yield of lower-rated corporate bonds to a benchmark Treasury rate, with statistical adjustments for embedded options and market complexities.
Historical Context
Financial analysts and policymakers use this spread to assess credit market conditions, potential investment risks, and broader economic trends in emerging market economies.
Key Facts
- Measures credit risk for lower-rated emerging market corporate bonds
- Provides insights into market perception of financial risk
- Helps investors and policymakers assess economic conditions
FAQs
Q: What does a widening spread indicate?
A: A widening spread suggests increasing perceived credit risk and potential economic instability in emerging markets. Higher spreads typically mean investors demand greater compensation for perceived risks.
Q: How often is this index updated?
A: The index is typically updated daily, reflecting real-time changes in market conditions and investor sentiment about emerging market corporate bonds.
Q: Why are option-adjusted spreads important?
A: Option-adjusted spreads provide a more nuanced view of bond yields by accounting for embedded options that can affect bond pricing and risk assessment.
Q: How do investors use this index?
A: Investors use this index to evaluate potential investment risks, compare different emerging markets, and make informed decisions about international portfolio allocation.
Q: What limitations exist in this index?
A: The index focuses on lower-rated bonds and may not fully represent the entire emerging market corporate bond landscape. It should be used in conjunction with other economic indicators.
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Citation
U.S. Federal Reserve, ICE BofA B & Lower US Emerging Markets Liquid Corporate Plus Index Option-Adjusted Spread [BAMLEM4RBLLCRPIUSOAS], retrieved from FRED.
Last Checked: 8/1/2025