Why higher interest rates haven't crushed corporate profits 🤔

In business, it's never ceteris paribus 🧐

The yield on the 10-Year Treasury note is often used as a benchmark for other forms of debt. (Source: Federal Reserve, FRED)

Interest rates have trended higher for the past three years, after falling for 40 years.

It’s a development that threatens to morph into multiple headwinds. For more, read: A bunch of ways higher interest rates are bad 👎

The most obvious headwind is higher interest expenses on any floating-rate debt or maturing fixed-rate debt that has to be refinanced at higher market interest rates.

However, these higher interest rates haven’t yet taken a material bite out of corporate profits.