Powered by stimulus-fueled market conditions and an institutional investor base that remains starved for yield, the U.S. leveraged finance market saw milestones and records aplenty in the third quarter, including a full-year issuance record and a total market size topping $3 trillion.

As the unprecedented quarter drew to a close, LCD asked leveraged finance professionals to take stock of the red-hot market, and to give an outlook on the months ahead, as the specter of Fed tapering and interest rate hikes becomes more real.

The full results of LCD's quarterly Leveraged Finance Survey, conducted from Sept. 16 to Sept. 24, are wide-ranging. Some of the highlights:

• Sub-1% leveraged loan default rates are expected well into 2022.
• Valuations in leveraged credit are a concern for most.
• A potentially "volatile mix" of influences are seen driving credit portfolios.
• Inflation is expected to top the Fed's 2% target a year from now.