Bangkok--3 Dec--Standard & Poor's
After recent economic news offered some glimmers of hope, the speculative-grade default rate in the U.S. held steady at an estimated 11.1% in November, said an article published today by Standard & Poor's. This level is unchanged from October.
"The stabilization in the default rate comes as fewer defaults are being recorded," said Diane Vazza, head of Standard & Poor's Global Fixed Income Research Group. "However, the pool of high-yield issuers is also shrinking, which is keeping the default rate elevated."
During November, eight companies defaulted, bringing the year-to-date total to 184. The defaults in November are attributable to six nonfinancial sectors and two financial sectors, according to the article, titled "U.S. Credit Metrics Monthly: Default Rate Holds Steady At 11.1% In November (Premium)."
The preliminary estimate for the U.S. 12-month-trailing speculative-grade default rate in November is 11.12% (subject to revision), in line with the 11.11% in October. We expect the speculative-grade default rate to decline to a mean forecast of 6.9% by September 2010, but it could reach 9.9% if economic conditions are worse than expected.
The standard version of this article is part of our standard Global Fixed Income Research content. The premium version contains expanded analysis of the article's most significant points, typically broken out by sector and region. Also in the premium version are in-depth charts and tables, the underlying data of which are available for download. Ratings information can also be found on Standard & Poor's public Web site by using the Ratings search box located in the left column at www.standardandpoors.com. Members of the media may request a copy of this report by contacting the media representative provided.
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