The global speculative default rate declined to 2.8% in January, down from 3.2% in December, and down from 12.6% a year ago, Moody’s Investors Service said Monday.
None of the corporate debt issuers that Moody’s rates defaulted in January, which is the first time there has been no default since June 2007. By comparison, there were eight defaults in January 2010, Moody’s notes.
“We continue to expect stable, low default rates for the near future,” said Albert Metz, Moody’s director of credit policy research. “Default rates would move upwards, however, should financing become scarce, particularly in Europe.”
Moody’s forecasting model predicts that the global speculative-grade default rate will decline to 1.5% by January 2012.
By industry, Moody’s expects default rates to be highest in the hotel, gaming, & leisure sector in the U.S. and the media sector in Europe.
Moody’s speculative-grade corporate distress index — a measure of the percentage of high-yield issuers that have debt trading at distressed levell — fell from December’s level of 10.5% to 8.6% in January. A year ago, the index was at 19.4%.
Global default rate drops in January: Moody’s
For the first time since 2007 none of the corporate issuers rated by Moody’s defaulted during the month.
- By: James Langton
- February 7, 2011 December 14, 2017
- 14:19