AI infrastructure spending surges with long-term debt, creating spillovers to bond markets

Capital expenditure to build artificial intelligence infrastructure is growing rapidly, with a rising share financed through long-term debt and complex off-balance sheet arrangements. A few large firms' off-balance sheet commitments transform debt credit ratings, attracting institutional capital. Banks lend to both the vehicles and investors holding the debt. On AI-financing-related news days in 2026, spillovers to US Treasury and investment-grade bond markets were small and short-lived, but sustained issuance at the current pace could change this.