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North American credit markets demonstrated notable resilience in May 2026, marking the first period without payment defaults since 2018. High-yield bond spreads reflected this underlying stability by tightening to 305bp, while leveraged loan issuance surged to a four-month high. Despite these positive indicators, the research indicates that market performance remains bifurcated, as CCC spreads widened in contrast to the tightening seen in the BB and Single-B categories. Institutional interest from abroad remains a critical factor, with foreign demand for USD Investment Grade bonds reaching yearly highs. This sustained demand is largely supported by favorable hedging offsets, which maintain the attractiveness of USD-denominated assets even as local yields decrease. Collectively, these insights suggest a credit environment where top-tier and mid-level assets are prioritized by investors despite the lack of recent defaults.