FAST FIVE: Corporate Defaults Would More Than Double Even In Mild Recession, S&P Global Warns

Published by on

According to S&P Global Ratings, the default rate for American companies could reach 3.75 percent by September 2023 if the Federal Reserve's hawkish policy of raising interest rates prompts a shallow or mild economic downturn.

In a far worse scenario in which a more serious economic downturn occurs, default rates could reach 6 percent, the highest since March 2021, analysts said.

Fed May Have to Raise Interest Rates Higher The warnings come shortly after James Bullard, president of the Federal Reserve Bank of St.

Louis, warned that the Fed may have to raise interest rates as high as 7 percent in order to cool off red-hot inflation.

“If you do more now, you have less to do in the first quarter [of 2023].

Categories: ZH