Emerging Market Corporates: How tight is tight? (III): Hyperscaler supply compressing CEMBI IG spread basis to US HG

Research evidence excerpt

Emerging Market Corporates: How tight is tight? (III): Hyperscaler supply compressing CEMBI IG spread basis to US HG

J P M O R G A N Global Credit Research

04 August 2026

Emerging Market Corporates

How tight is tight? (III): Hyperscaler supply compressing

CEMBI IG spread basis to US HG

• The spread of CEMBI BD IG has been converging towards US HG, and Emerging Markets Corporate

we think the increased issuance from US hyperscalers is accelerating the Strategy

narrowing of the basis. While there may be some unease over the concept Yang-Myung Hong AC

of EM corporate spreads trading at the same level as US HG on a headline (1-212) 834-4274

index basis, we have been of the view that CEMBI IG spread can trade flat ym.hong@jpmorgan.com

to US HG with the year-end spread target aligned at 95bp for both indices. Alisa Meyers

(1-212) 834-9151

• The headline spread does not tell the whole story given CEMBI BD IG has alisa.meyers@jpmorgan.com

significantly shorter duration than US HG, so would still offer a spread J.P. Morgan Securities LLC

pickp-up for comparable maturities. In addition, the composition of CEMBI IG

went up in quality over the past 10 years whereas US HG is not much changed

during this period.

• The most recent driver has been supply technicals, where the US HG How tight is tight? The bottom line in

market is experiencing elevated issuance from highly rated hyperscalers CEMBI spread

and datacenter bonds which are skewing spreads wider. By comparison,

EM corporate IG supply has been much more orderly with the main How tight is tight? (II): Improved average

contribution from Asia and Middle East, where local investors continue to rating of CEMBI supports tighter spreads

anchor the demand.

• We think investors are differentiating between the AI-related sector and