Short supply, long demand
Investors are chasing income that lasts, but issuers are pulling back on offering it. On Monday, Aon Inc. issued 30-year notes totaling $2 billion, attracting roughly $10 billion in demand. Earlier this month, GSK Plc placed $500 million of 30-year bonds, and orders were about ten times the size of the deal. In 2026, the typical high grade U.S. corporate deal has seen order books around four times the size of the notes for sale.
“The opportunity is there now to extend out the curve, and we have been buyers of long investment grade corporate bonds,” said Matt Eagan, who manages portfolios at Loomis, Sayles & Co. He added, “The challenge is the scarcity of this kind of paper,” noting that artificial-intelligence related issuance is a notable outlier. That scarcity shows up in the data: in the first half of September, only 5% of U.S. investment-grade bonds – about $108.3 billion – carry maturities of 30 years or longer, the smallest share for that span since at least 2020.
Why yields are up and tenors are down
Yields have marched higher around the world, especially at the long end, as inflation worries pick up. Year to date, the 30-year Treasury yield has climbed about 0.4 percentage point, finishing near 5.37% – a post-financial-crisis high – on the eve of the Federal Reserve’s quarter-point rate hike, its first increase in three years. Central banks, including the Fed this week, are pushing rates up to cool longer-term borrowing costs, and on Wednesday the Fed indicated that another hike is likely before year-end.
Those inflation concerns are being stoked by a surge in oil and the protracted Iran war. On Sept. 10, the European Central Bank raised borrowing costs for a second time since the conflict began, and by October 2027 markets fully discount three more hikes.
Years of falling rates once encouraged companies to lock in ultra-cheap money, taking the average maturity of the U.S. high-grade market to a 12.4-year peak, according to Barclays strategists. With borrowing costs higher, that is reversing, with average maturity shrinking to 10.3 years.
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Knock-on effects from tech to pensions
Costs aren’t being set by central banks alone. This year, Alphabet Inc. and Amazon.com Inc. have deluged investors with long-dated debt, displacing even some sovereign borrowers as money shifts from older paper into higher-yielding bonds from hugely profitable hyperscalers.
The tilt toward shorter maturities has side effects. With fewer bonds due in 30 years or more, some companies may end up refinancing more frequently. It also leaves life insurers and pension plans with fewer long-dated assets to match annuities and future retiree payouts. The private markets tell a similar story: in 2026, new private placement bond deals average roughly 8.9 years in tenor, a decline from 13.2 years in 2021.
Global pattern, and the deals to watch
This is a worldwide trend. In Europe, borrowers are tilting to shorter timelines, with roughly 80% of this year’s issuance due within a decade, compared with 65% last year. In Asia Pacific, there was only a single non-callable dollar bond with a maturity of 10 years or more during the first half of September: Norinchukin Bank issued a $500 million note, the leanest tally for that window in 15 years, versus roughly $6.7 billion by this point in 2025.
Back in the U.S., Sysco Corp.’s $17 billion sale could arrive as early as next week, and may feature the now-rare 30- and 40-year fixed-rate tranches, with proceeds earmarked for its $29 billion purchase of Jetro Restaurant Depot. Citigroup’s offering this week saw peak orders near $18 billion for its longest tranche – $4.5 billion of 11-year notes. Even so, many issuers are opting for five- or seven-year maturities, or shorter, in hopes that borrowing costs ease later.
Why this matters for your money: if your goals rhyme with pension or annuity timelines, the mix of eager buyers and reluctant issuers means fewer new long bonds to pick from even as coupons look juicier. That scarcity can shape what shows up in bond funds and how much income you can lock in for the long haul.
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