Global Corporate Debt Pile Is Shrinking as Funding Costs Surge

Companies’ global debt load is declining for the first time in eight years as the cost of financing soars and firms limit issuance amid recession fears.

A corporate-debt index by Janus Henderson showed an almost 2% drop in net debt in the 12 months ending in March, marking the first year-on-year fall in indebtedness since 2014. The global $8.15 trillion pile may shrink by a further $270 billion until March 2023, the asset manager predicted on Wednesday, based on levels of maturing debt and its forecasts for issuance.

The decline underscores a lack of debt supply as the soaring cost ...