Junk-rated borrowers are lining up around €3.7 billion ($4.3 billion) in refinancing deals, accepting significantly higher rates to avoid even greater costs if they wait. Europe’s high yield market is set for its busiest week since June, with at least seven deals announced on Monday. Borrowers including auto parts maker ZF Friedrichshafen AG and gambling software firm Playtech Plc are refinancing maturities several years out, with German pharmaceutical company Gruenenthal Gmb H even looking at debt due in 2030.

Borrowers needing to refinance 2028 debt are tapping markets now before interest rates rise further and credit spreads widen, aiming to get ahead of a large amount of buyout debt coming to market toward the end of September. Traders are betting on three more interest rate hikes by the European Central Bank by October 2027, after the central bank last week raised rates to 2.5%. The Federal Reserve is also widely expected to increase rates on Wednesday for the first time in three years.

Oil prices topped $108 a barrel on Monday after the closure of Saudi Arabia’s major crude pipeline, exacerbating fears of an inflation resurgence. Brightstar Lottery Plc set the tone for high yield refinancings last week, refinancing notes due in April 2028 that had been paying 2.375% for new debt due in 2032 with a 5% yield. ZF Friedrichshafen is selling a new four and a half year bond at a yield of around 6.25% to refinance outstanding notes with coupons as low as 2% and maturities from mid-2027 to 2028.

Avolta AG, an operator of duty-free shops in airports, is holding investor calls for a €350 million senior bond sale to partially refinance existing 2027 notes carrying a 2% coupon. Playtech is seeking €350 million to redeem existing 2028 notes while Gruenenthal is planning an €850 million sale across fixed and floating rate tranches to repay 2028 and 2030 notes.