S&P Warns of Default Wave Ahead for Latin America as Rates Rise
- Defaults may pick up in Brazil due to floating-rate debts
- Chile and Colombia firms face the sharpest deterioration
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Rapidly rising borrowing costs pose more of a threat to companies in Latin America than anywhere else in emerging markets, raising concern that defaults in the region are about to rise, according to S&P Global Ratings.
Credit conditions are tightening more quickly now in Latin America than they were at the height of the 2008 financial crisis, analysts led by Gregoire Rycx wrote in a report. That is expected to put companies under pressure through the end of next year.