February chalked up the largest month of negative net supply ever seen in European investment grade, with the corporate bond market shrinking by €8 billion. The supply contraction has helped already range-bound credit spreads to grind even tighter.
According to ABN Amro, just €6.4 billion of non-financial paper was issued, down from €9 billion in January. But redemptions took €15 billion of bonds out of the market.
It is not unusual for corporate bond issuance to take a dip in February, as the
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