AI bubble overtakes geopolitics as top concern for credit investors, BofA survey finds

A new Bank of America (BofA) survey of investment-grade credit investors has identified a significant shift in market sentiment, with the risk of an artificial intelligence bubble now ranking as the top concern for the first time. According to BofA strategists Barnaby Martin, Ioannis Angelakis, and analyst Mohit Agarwalla, 23% of surveyed investors now view an AI bubble as their primary risk, a substantial increase from just 9% in December 2025. This concern has overtaken long-standing fears about geopolitics and overpriced credit markets, signaling a major reprioritization of investment risks as AI spending accelerates.

The survey data indicates that investors expect mega-cap cloud and data center operators, known as hyperscalers, to issue approximately $285 billion in new debt this year to fund their AI infrastructure expansion. This figure represents a 36% increase from the $210 billion expected just two months prior, with nearly 30% of investors believing the total could exceed $300 billion. This projected surge in capital expenditure, driven by companies like Amazon and Meta Platforms, is fueling fears of excessive valuations and overinvestment. The findings highlight a critical tension between the transformative potential of AI technologies and growing market apprehension about the financial sustainability of the current investment boom.