The global default rate for speculative-grade securities rose slightly in July, New York-based Moody’s Investors Service announced on Monday.
The global default rate ticked up to 2.4% in July from 2.3% in June, the credit rating agency notes. In the United States, the default rate rose to 2.2% in July from 2.0% in June, Moody’s says. In Europe, the rate remained unchanged at 2.0% in July.
The oil and gas sector, which has accounted for a quarter of the defaults recorded so far this year, remains the most troubled sector, the rating agency adds. The metals and mining sector is also showing signs of stress, it adds, noting that the sector has recorded 20% of defaults in the year to date.
Moody’s default rate forecasting model now predicts that the global default rate will continue to rise, ending 2015 at 2.7%. However, despite the upward trend, this would still be well below the historical average for the global speculative default rate of 4.5%, the credit rating agency says.