High-Yield Credit Spreads (OAS)
Track high-yield credit spreads (ICE BofA HY OAS). Widening spreads signal rising default risk and are a classic recession leading indicator.
Current Value
Trigger Level: >500 bps = credit stress
Historical Trend
AI Analysis
Today's value for the High Yield Option-Adjusted Spread (HY OAS) is 282 basis points, reflecting a slight decline from 292 bps on February 12, 2026, with a recent peak of 328 bps on April 2. The trend over the past month shows a stabilization around the lower end of the recent range, indicating tight credit spreads and a potential easing of credit stress. This trend suggests a low recession risk at present, as the consistent readings below 300 bps indicate healthy credit market conditions, with spreads tightening from a peak of 328 bps, signaling investor confidence and stability in the high-yield sector.
What is the Credit Spreads?
The ICE BofA High Yield Option-Adjusted Spread (HY OAS) measures the yield premium investors demand for holding high-yield corporate bonds over risk-free Treasuries. It reflects credit risk and default expectations.
Why It Matters for Recession Risk
Widening credit spreads signal that bond investors are demanding more compensation for default risk — a sign of deteriorating economic conditions. Spreads above 500bps have historically coincided with recessions.
Historical Context
Spreads blew out to 1,100bps during the 2008 crisis and 1,087bps during the March 2020 COVID crash. Rapid widening from compressed levels is particularly significant as a recession warning.
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