The U.S. private credit market faces a surge in redemptions as the new quarter begins.

Huo Xing Finance reports that on June 5, as the new quarterly redemption window opened, another wave of redemptions hit the U.S. private credit market. Multiple leading institutions disclosed record-breaking redemption requests, indicating that the market’s confidence in this $1.8 trillion industry is far from being restored. Blackstone’s BCRED fund saw redemption requests reach 10%, setting a new high and hitting the 5% cap; Cliffwater’s flagship fund saw its redemption rate rise to 17%, while Partners Group was forced to close its exit channels. Fitch data shows that default rates in private credit have climbed to a historic peak of 6%, and PIMCO has warned that a sustained credit default cycle has begun. The private credit industry remains heavily concentrated in software assets, which are now under renewed pressure due to the disruptive impact of artificial intelligence. PIMCO’s Chief Investment Officer, Daniel Ivascyn, warned, “A sustained credit default cycle has begun for the first time in many years.”