US companies are for the first time the biggest borrowers of euro-denominated corporate bonds, issuing a record €87.7 billion of debt, according to data compiled by Bloomberg.
Companies from Apple to McDonald’s have made up a fifth of total new issuance in the market, more than any European country and up from just 1.5% five years ago.
Mr Draghi’s easy-money policies are making it cheaper than ever for corporate America to cross the Atlantic to issue debt.
That’s because the ECB is pledging to boost stimulus just as Federal Reserve policy makers are prepared to raise interest rates for the first time in a decade.
The difference between borrowing costs in the US and Europe has widened to the most ever, and few see the gap closing any time soon.
“It’s not a one-shot phenomenon,” said Marco Baldini, the London-based head of European corporate and sovereign, at Barclays, the biggest arranger of bonds from companies domiciled outside the eurozone.
American companies have become such a big part of the European market that investors started to ease policies limiting the amount of foreign-issuer debt they can buy.
Investors demand an average of 1.33% to hold euro- denominated bonds sold by investment grade companies, Bank of America Merrill Lynch indexes show.
That compares with 3.52% for similarly rated dollar bonds.
The difference in borrowing costs between US and European debt rose to 2.17 percentage points on November 17, the highest ever.
US companies contributed to a euro bond sales tally that by the middle of 2015 had already dwarfed all of last year’s record issuance.
The next round of debt sales won’t be limited to US blue-chip borrowers.
“So far the U.S. issuers that have come in euros this year have been high-quality names with the ability to issue opportunistically,” said Gordon Shannon, a portfolio manager at TwentyFour Asset Management.
“But as the US market becomes increasingly more saturated by the weight of issuance, we’re seeing a wider variety of US names issuing in euros.”
Borg Warner, a US auto-part maker, sold inaugural notes in euros this month.
Selling debt in euros isn’t practical for all US companies, said Wells Fargo.
While cross-border borrowings would prove attractive for well-known names “the debt footprint for only a small handful is large enough,” said analysts led by George Bory and Nathaniel Rosenbaum.
“There are still headwinds for European growth, which suggests the ECB needs to do more,” said Jack McIntyre, at Brandywine Global Investment in Philadelphia.
That makes it “still attractive to issue away from the US.”