Bangkok--25 Nov--Standard & Poor's
The Standard & Poor's speculative-grade composite spread continued its widening trajectory on Friday, reaching a new five-year high of 1,548 basis points (bps), surpassing its previous five-year record of 1,527 bps. Five-year record highs were seen across the board in the speculative-grade domain as well, with 'BB' widening to 1,079 bps, 'B' to 1,639 bps, and 'CCC' to 2,962 bps.
The investment-grade spread, on the other hand, tightened off its five-year record of 534 bps, leaving it at 514 bps. The 'AA' spread tightened to 416 bps, 'A' to 470 bps, and 'BBB' to 617 bps.
With speculative-grade defaults on the rise, a higher preponderance of credit downgrades, and a general malaise about the future of the economy, we expect spreads to remain at their elevated levels for some time until confidence is restored to the market.
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