ICE BofA CCC & Lower US High Yield Index Option-Adjusted Spread
This dataset tracks ice bofa ccc & lower us high yield index option-adjusted spread over time.
Latest Value
8.39
Year-over-Year Change
-0.59%
Date Range
12/31/1996 - 8/6/2025
Summary
The ICE BofA CCC & Lower US High Yield Index Option-Adjusted Spread measures the credit risk premium for the lowest-rated corporate bonds in the United States. This metric provides critical insight into market stress, investor sentiment, and potential economic challenges for high-risk corporate borrowers.
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 CCC-rated and lower corporate bonds and comparable U.S. Treasury securities, reflecting the additional risk premium demanded by investors. Economists and financial analysts use this spread as a key indicator of credit market conditions and potential economic distress.
Methodology
The spread is calculated by comparing the option-adjusted yield of low-rated corporate bonds to a benchmark Treasury yield, accounting for embedded options and potential variations.
Historical Context
Policymakers and investors use this spread as a leading indicator of potential economic downturns, credit market liquidity, and corporate financial health.
Key Facts
- Represents the credit spread for the lowest-rated corporate bonds
- Wider spreads indicate higher perceived risk in credit markets
- Serves as an early warning indicator for potential economic challenges
FAQs
Q: What does a high spread indicate?
A: A high spread suggests increased credit risk and potential financial stress in the corporate sector. Investors demand higher returns to compensate for perceived higher default risks.
Q: How does this index relate to economic health?
A: Widening spreads often signal potential economic challenges, reduced corporate profitability, and increased likelihood of defaults in the corporate bond market.
Q: How is the spread calculated?
A: The spread is calculated by comparing the yield of CCC-rated and lower corporate bonds to comparable U.S. Treasury securities, adjusted for embedded options.
Q: Why do investors track this index?
A: Investors use this index to assess credit market conditions, potential economic risks, and make informed decisions about corporate bond investments.
Q: How often is this data updated?
A: The index is typically updated daily, providing real-time insights into credit market conditions and corporate bond risk premiums.
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Citation
U.S. Federal Reserve, ICE BofA CCC & Lower US High Yield Index Option-Adjusted Spread [BAMLH0A3HYC], retrieved from FRED.
Last Checked: 8/1/2025