Global High-Yield Default Rate Seen Hitting 5% in 2024, Moody’s Says
- Corporate defaults to peak at 5% in April before easing in May
- Higher borrowing costs, tight lending standards add pressure
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Defaults are expected to rise among the riskiest companies, as central banks hold interest rates near peak levels while tighter lending conditions and elevated input costs weigh on borrowers, according to Moody’s Investors Service.
That “will set the stage” for more defaults across firms with weak earnings and heavy debt burdens, particularly those borrowing mainly in the loan market, strategists including Sharon Ou wrote in a June 15 note.