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Business · Updated 15 Oct, 05:56 pm IST

Rising cost of credit default swaps worries AI investors

Image: ET Tech

Why it matters for readers: This shows how worries about interest rates and returns can ripple through markets and affect the AI industry.

  • The cost of insuring against potential US tech defaults via CDS has hit record levels.1
  • Demand for AI-linked CDS has surged, especially for companies tied to data centres and compute infrastructure.1
  • Even large tech names such as Apple, Amazon and Microsoft have seen increased demand for CDS protection.1
  • Recent share falls reflect investors reassessing the cost of capital amid rising interest rates and inflation.1
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