AI Borrowing Tests Credit Market Capacity as Investors Turn Selective

The rapid expansion of AI-related borrowing is testing how much new debt credit markets can absorb, with signs that investors are becoming more selective about which companies and projects they will finance. Bloomberg reported that at least 18 data-center financings in the junk-bond and leveraged-loan markets now carry double-digit yields, while one investment manager said the firm had moved underweight data-center debt. The report points to mounting concern as borrowing funds the data centers and chips behind the AI buildout.