Speculative-grade default rate to peak in Q4

Just when everyone thought the worst of the crisis was over, Moody's has spoilt the party, or so it seems. It has said that the 12-month global speculative-grade default rate rose to 12% in Q309 from 10.6% in Q2. Worse, Moody's only expects it to peak in Q4 at 12.5%. Yet BMI's view that the recovery is sustainable does not clash with the continued rise in defaults: it is hardly surprising that there is a lag between the recession trough and the peak in the default rate of businesses. More interesting is Moody's forecast that the rate will decline sharply

To read the full article, please choose one of the following options: