APAC Cross Regional Credit Weekly: Spreads supported by higher yields

Research evidence excerpt

APAC Cross Regional Credit Weekly: Spreads supported by higher yields

J P M O R G A N Asia Pacific Credit Research

04 August 2026

APAC Cross Regional Credit

Weekly

Spreads supported by higher yields

• JULI spreads tightened by 2bp to 93bp over the week, split between Asia Pacific Credit Research

AC hyperscalers -13bp w/w to 138bp vs ex-hyperscalers -1bp w/w to 90bp. The Matthew Hughart

index yield went up 2bp w/w to 5.81%. (852) 2800-6518

• HG fund inflows slowed to $3.3bn (-37% w/w), below the four-week matthew.hughart@jpmorgan.comJ.P. Morgan Securities (Asia Pacific) Limited

average of $6.4bn. The e slowdown was driven by mutual funds, which

Emma Xing

flipped to modest outflows of $132mn (-$1.7bn w/w; their first outflow in 14 (852) 2800-8727

weeks), while ETF inflows declined to $3.4bn (-5% w/w). emma.xing@jpmorgan.com

• Last week, $30bn of gross issuance priced against $28bn of reinvestment J.P. Morgan Securities (Asia Pacific) Limited

income. Our US HG team estimates that reinvestment income will fall to Soo Chong Lim

$32bn this week. (852) 2800-7387

soochong.lim@jpmorgan.com

• Looking ahead, higher HG yields should still be supportive for spreads. J.P. Morgan Securities (Asia Pacific) Limited

However, the benefit is less certain given the market is pricing in two hikes North America Credit Research

through mid-2027 and geopolitical uncertainty around Iran. Our US team sees Nathaniel Rosenbaum, CFA

that if yield buyers step in, the 10s30s spread curve could flatten. (1-212) 834-2370

• Our economists pulled forward the next hike forecast from 3Q27 to nathaniel.rosenbaum@jpmorgan.comJ.P. Morgan Securities LLC

December this year, with policy rates on hold at 3.75-4.0% thereafter.

However, if the CPI heats up, the discussion around the September FOMC

would intensify.