In bond markets, rising Middle Eastern tensions drove oil and gas prices higher, fuelling energy-induced inflation expectations. Consequently, longer-term bond prices in both the US and Canada witnessed one of their worst weeks since “Liberation Day.” This inflationary concern due to rising oil prices has reduced the probability of a rate cut in the US, scheduled to be announced by the Federal Reserve on March 18, 2026. Despite a volatile start to the week, Baker Hughes Co. looked to raise USD$10 billion total in a cross-border bond sale to fund an acquisition of Chart Industries Inc., and Eaton Corp. raised USD$8.5 billion for an AI-data centre related acquisition of Boyd Thermal. Separately, JPMorgan Chase led the debt financing syndicate for a record-breaking USD$55 billion leveraged buyout of Electronic Arts Inc. by private equity firms Silver Lake Management, Saudi Arabia’s public investment fund, and Affinity Partners. Private credit risk remained a key discussion point, as Blackstone’s global head of private credit addressed a record 7.9% quarterly redemption on their flagship private credit fund. 

Increased focus on private credit risks led Bank of Canada Governor Tiff Macklem to call for greater regulatory surveillance of non-bank (such as hedge fund) lending to maintain global financial stability. From a retail standpoint, private credit funds, while paying investors a premium for illiquidity, are often misunderstood due to their restrictive capital lock-up periods and strict redemption guidelines. Late last week, one of BlackRock’s largest private credit funds, the US$26 billion HPS Corporate lending fund, capped withdrawals at 5%. Bloomberg reported that shareholders requested 9.3% of their funds. Goldman Sachs' co-credit chief emphasized that limited withdrawals are "intended features" that allow private credit funds to better achieve investment objectives, while avoiding forced fire sales at discounted prices. This illiquidity challenge is underscored by a recent flurry of redemption requests, particularly from funds exposed to the AI-disrupted software loan industry, such as Blackstone's flagship fund battling a record 7.9% in redemptions (exceeding its quarterly 5% limit) and Blue Owl Capital, which previously had a 15% net asset redemption request requiring a forced-sale of USD$1.4 billion of portfolio loans for liquidity. Consequently, private credit investors should carefully scrutinize the underlying loan assets and clearly understand these established lock-up periods and redemption features prior to investing, all-while ensuring alignment with their intended risk tolerance.

In new bond issuances, Baker Hughes Co. planned to raise US$10 billion total through a cross-border sale of euro and US dollar bonds to help fund its acquisition of Chart Industries Inc. The proceeds are intended to replace a yearly loan facility, making this one of the larger potential offerings in the high-grade bond market since the Iran disruption slowed new bond issues earlier in the week; the acquisition will expand the company’s reach into liquified natural gas (LNG), data centres, and technology. Separately, Eaton Corp. sought to raise around USD$8 billion from a six-part bond sale, with maturities ranging from 2 to 30 years (and the 2056 maturity bond priced to yield an expected 0.78% above treasuries), to fund its pending USD$9.5 billion acquisition of Boyd Thermal, a liquid cooling specialist tied to AI data centre application.