'AI Has Been A Bust' For Fixed Income: Skiba

Watch on YouTube ↗  |  August 27, 2026 at 20:59  |  3:31  |  Bloomberg Markets
Speakers
Andrzej Skiba — Head of BlueBay US Fixed Income at RBC Global Asset Management
Kyra Fecteau — Fixed Income Portfolio Manager, Wellington Management
Scarlet Fu — Anchor, Bloomberg Television

Summary

The segment examines AI-related fixed income financing, with Andrzej Skiba arguing AI debt has disappointed fixed income investors but now offers selective value in investment-grade deals priced like high yield. He also warns that five-year non-call two AI project bonds face refinancing risk. Kyra Fecteau says the roughly $1.4 trillion AI/hyperscaler capex pipeline will push issuance and opportunities beyond U.S. dollar credit and force more disciplined segmentation between stabilized IG assets and speculative high-yield projects.

  • Skiba says heavy AI debt issuance has not rewarded fixed income investors.
  • Investment-grade AI/data center deals are now arriving at high-yield valuations, creating selective entry points.
  • Skiba warns AI project 5NC2 bonds may struggle to refinance as issuance grows.
  • Fecteau estimates about $1.4 trillion of AI/hyperscaler capex is expected.
  • AI-related issuance and opportunities may spread into euros, Swiss francs, yen, and other non-dollar markets.
  • Fecteau sees stabilized AI assets belonging in investment grade and speculative pre-construction assets in high yield.
  • The market is becoming more selective and demanding more discipline in AI-related credit structures.
Ideas
Andrzej Skiba Head of BlueBay US Fixed Income at RBC Global Asset Management 0:20
AI IG bonds offer high-yield valuations.
Andrzej argues that AI-related debt has not rewarded fixed income investors despite heavy issuance, so investors now demand more spread and selectivity. The key opportunity is investment-grade rated AI/data center deals that are being priced at high-yield valuations; investors who do credit work can get much more attractive entry points than simply funding hyperscaler capex.
AI/data center investment-grade bonds HIGH
Andrzej Skiba Head of BlueBay US Fixed Income at RBC Global Asset Management 1:30
AI project 5NC2 bonds face refinancing risk.
He sees the biggest risk in AI project debt as refinancing timing. Many deals are five-year non-call two bonds expected to be called in two years once projects are built, but the wave of issuance increases the chance the market cannot refinance them. The old assumption that built projects automatically get an investment-grade rating and can refinance may no longer hold.
AI project high-yield 5NC2 bonds HIGH
Kyra Fecteau Fixed Income Portfolio Manager, Wellington Management 2:29
AI capex financing spreads beyond dollar credit.
Kyra estimates about $1.4 trillion of AI/hyperscaler capex and argues no single market can absorb that capacity. Issuers are already moving among U.S. investment grade, high yield, leveraged loans, and securitized markets as each saturates. That means AI-related issuance and opportunities must be spread more broadly into euros, Swiss francs, yen, and other non-dollar markets, not just U.S. dollar credit.
Non-USD AI/hyperscaler credit MED
Kyra Fecteau Fixed Income Portfolio Manager, Wellington Management 3:02
Stabilized AI assets IG; speculative HY.
She draws a quality split for AI-related credit: stabilized data center assets belong in the investment grade market, while speculative projects that have not been built or spec'd out belong in high yield. The market is moving toward this discipline after issuers tried to sell similar deals across investment grade, high yield, leveraged loan, and securitized markets.
Speculative pre-construction AI high-yield credit Stabilized AI/data center investment-grade credit MED
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This Bloomberg Markets video, published August 27, 2026, features Andrzej Skiba, Kyra Fecteau discussing AI/data center investment-grade bonds, AI project high-yield 5NC2 bonds, Non-USD AI/hyperscaler credit, Speculative pre-construction AI high-yield credit, Stabilized AI/data center investment-grade credit. 4 trade ideas extracted by AI with direction and confidence scoring.

Speakers: Andrzej Skiba, Kyra Fecteau  · Tickers: AI/data center investment-grade bonds, AI project high-yield 5NC2 bonds, Non-USD AI/hyperscaler credit, Speculative pre-construction AI high-yield credit, Stabilized AI/data center investment-grade credit