Investors Now See Some Companies as Safer Bets Than Governments

In corporate boardrooms since the pandemic era, executives have dealt with the rise in interest rates by keeping budgets lean and reducing overall indebtedness. Meanwhile, governments in rich countries continue to spend, with the average debt-to-output ratio across the Group of Seven industrialized nations set to keep rising until the end of this decade at least. The result: Investors demand lower yields for bonds issued by Microsoft Corp., Airbus SE, L’Oreal SA, and Siemens AG than they do for their countries of origin.