AI Capex Wave Tests Bond Market Depth

Russell Investments2.69K FollowersFollow5ShareSavePlay(11min)SummaryAI-related capital expenditures could reach $5 trillion, led by high-grade technology issuers.The scale of financing could pressure spreads moderately, though market demand remains strong.Credit quality may improve overall as large, high-rated firms become major borrowers.Investors must assess asset longevity and residual value risk in data center financing. MicroStockHub/iStock via Getty Images The $5 trillion buildout The global race to build AI infrastructure has accelerated sharply. Estimated capital expenditures now total more than $5 trillion, equivalent to the annual GDP of Germany. That magnitude matters for bond investors: roughly $1.5 trillion of thisThis article was written byRussell Investments2.69K FollowersFollowRussell Investments is a leading global investment solutions partner providing a wide range of investment capabilities to institutional investors, financial intermediaries, and individual investors around the world. Since 1936, Russell Investments has been building a legacy of continuous innovation to deliver exceptional value to clients, working every day to improve people’s financial security. The firm has US$331 billion in assets under management (as of 12/31/2024) for clients in 30 countries. Headquartered in Seattle, Washington, Russell Investments has offices in 17 cities around the world.