Media reports indicate that the &#34;AI bubble&#34; has become the biggest concern for credit investors for the first time, according to a survey conducted by Bank of America among its clients.
Bank of America strategist Barnaby Martin and others wrote in a report on Tuesday:
<blockquote>
&#34;Almost no one is worried about geopolitical issues or central bank policy missteps.&#34;
</blockquote>
Among the investment-grade respondents in this survey, 23% view the risk of an AI bubble as their primary concern, compared to only 9% in Bank of America's previous survey last December.
The survey shows that concerns about unsustainable surges in investment and valuation of AI companies have surpassed &#34;credit market bubbles,&#34; becoming the new biggest risk. During 2025, trade tensions and global economic recession were also seen as the biggest potential risks.
Investment-grade investors have raised their expectations for bond issuance from &#34;hyperscalers&#34; this year to $285 billion, a significant increase from the $210 billion projected in last December's survey.
However, the strategists wrote:
<blockquote>
&#34;Investors are actually more relaxed about the ultimate technological disruption: only 10% of respondents believe that the elimination of AI-driven companies is their biggest concern.&#34;
</blockquote>
At the same time, they noted that fund inflows are the main factor determining credit spread levels and are sufficient to offset the bond weakness caused by AI risks.
A total of 54 high-rated and high-yield clients of Bank of America participated in the February survey, including insurance companies, pension funds, and hedge funds

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The latest survey from Bank of America shows that the "AI bubble" has become the top concern for credit investors for the first time, with 23% of investment-grade respondents listing it as the primary risk, a significant increase from December of last year. Concerns about the rapid surge in investment and valuation of AI companies have surpassed traditional risks such as credit market bubbles, trade frictions, and global recession

- A recent survey by Bank of America reveals that "AI bubble" is now the biggest concern for credit investors, with 23% of respondents citing it as their primary worry, up from 9% in December 2022.  
- Concerns about unsustainable rises in AI company valuations have surpassed worries about the credit market bubble, with geopolitical tensions and global economic downturns previously seen as larger threats.  
- Despite these concerns, investors remain calm about technological disruption, considering it less significant, while bond issuance expectations from hyperscalers have increased to $285 billion this year.

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Bank of America survey: AI bubble becomes the number one risk in the credit market, with 23% of investment-grade investors viewing it as the biggest threat