Ask Question
22 June, 23:25

According to WSJ article, companies like Apple, Deere, and Walt Disney recently issued new bonds on the market, totaling $27 billion offering on a single day on Sep. 3. What explains such an increased activity in a corporate bond market

0
Answers (1)
  1. 22 June, 23:31
    0
    Answer: Fall in Benchmark Interest Rates.

    Explanation:

    This activity was caused by a Refinancing Drive. Refinancing is when entities get a new loan with a lower interest rate and pay off the older loan with a higher interest rate so that they can pay at the lower rate.

    Bond interest rates are usually fixed so when interest rates in a country fall, bond holders don't benefit from that. One option they have to take advantage of that is to go on a Refinancing Drive and issue new bonds at those lower rates and then pay off the older ones.

    That is what Apple, Deere, and Walt Disney have done.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “According to WSJ article, companies like Apple, Deere, and Walt Disney recently issued new bonds on the market, totaling $27 billion ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers