43% of market participants expect inflation to remain at or above 3.5% in the second half of 2026, per PitchBook LCD data.
Inflation and software sector risks dominate concerns among US leveraged finance market participants for the second half of 2026. A PitchBook LCD survey revealed 43% of respondents anticipate inflation rates of 3.5% or higher, while 71% view software as the least favorable sector for credit investment in H2.
Spread widening expectations have eased, with only 25% of participants forecasting wider spreads over the next six months. However, AI-related anxiety is rising, with 10% reporting very high concern, up from zero, and 77% expressing moderate concern.
The survey, conducted from June 16-29, gathered insights from buy-side, sell-side, and advisory professionals. Recent geopolitical tensions, including the US-Iran conflict, had previously driven oil prices above $80 per barrel before a tentative peace deal pushed them lower.