Junk Bond Risk Premiums Fall to a Record Low on Signs Economy Accelerating

(Bloomberg) -- Risk premiums on high-yield, high-
risk U.S. corporate bonds fell to a record low on speculation
the economy is accelerating, bolstering the ability of companies
to meet their debt payments.

The extra yield investors demand to own junk bonds instead
of Treasuries narrowed to 2.42 percentage points on average
yesterday, based on Merrill Lynch & Co.'s high-yield index. The
spread is less than half the average of more than 5 percentage
points over the past five years, and is down from more than 10
percentage points in 2002.


Read more at Bloomberg Bonds News