After a year of record negativity, credit rating outlooks have now turned slightly positive, Moody’s Investors Service said on Thursday.
In a new report, the rating agency said the balance of industry sector outlooks at the start of 2021 has tilted to the positive.
Moody’s said seven sectors now enjoy positive outlooks, just five are negative, and 35 sectors have stable outlooks.
Sector outlooks reflect the rating agency’s view on an industry for the coming 12 to 18 months,
“For the first time since mid-2019, there are more positive than negative outlooks, with many industry segments showing improvement, and in some cases, nearly close to their pre-pandemic levels,” said Edmond DeForest, vice president and senior credit officer at Moody’s, in a release.
With “unprecedented fiscal and monetary policy” support in response to the Covid-19 crisis, the rating agency said it expects global credit conditions to improve overall in 2021.
Despite the positive shift, Moody’s cautioned that downside risks remain.
The global economic recovery is still fragile and is “under threat from still-high Covid-19 cases in the U.S. and Europe, despite vaccine dissemination,” said the ratings agency.