Credit Market Research
Our credit market research encompasses ratings performance indicators (including upgrades and downgrades, defaults, outlook changes, weakest links, rising stars, and fallen angels) alongside default and issuance forecasts and financing conditions coverage.
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Credit Trends
Global Financing Conditions: Issuance Growth Could Slow In 2026 As Strains Persist
Global economic growth and bond issuance remained resilient in 2025 through bouts of heightened market risk, and we expect this to continue in 2026, though issuance growth could slow to 4.8%.
A healthy refinancing pipeline and accelerating M&A activity should support corporate (including financial services) issuance growth.
A multiyear AI and data center investment phase has started, which will likely continue to boost issuance by the high-tech sector, though the precise timing and extent of future debt issuance are far from certain.
As we enter the latter phase of this credit cycle, we maintain the possibility for issuance to decline in our downside scenario, where economic growth slows, geopolitical risks finally shake market confidence, or China's issuance growth slows amid efforts to reduce certain debt.
This Week In Credit
Defaults Surge
Rating activity accelerated last week, with upgrades continuing to outpace downgrades. All six downgrades were speculative‑grade, with U.S. issuers accounting for four of them.
Positive outlook revisions and CreditWatch placements increased by five, exceeding negative ones for the fourth consecutive week. We revised the outlook on Italy to positive from stable, reflecting fiscal and external resilience. This action drove subsequent outlook revisions on several Italian issuers.
Seven defaults last week brought the year‑to‑date total to 13, above 11 a year ago. Five occurred in the U.S. and two in Luxembourg. Consumer products accounted for three of the seven.
This Month In Credit
Signs Of Deterioration
Downgrades outnumbered upgrades as monthly speculative-grade downgrades increased to their highest level since June 2025, driven by issuers rated 'B' or below, accounting for 60% of December’s downgrades.
Pressure remains at the lower end as negative bias for issuers rated 'B-' and below increased by 1.3 percentage points last month, its largest rise since May 2025, suggesting the number of downgrades among lower-rated entities could remain elevated.
In a more positive sign, aggregate net bias improved to its strongest level since April, primarily driven by a third consecutive monthly increase in positive bias to its best level since March 2025.
Structured finance: Following an increase in corporate downgrades to 'CCC+' or below, the U.S. broadly syndicated loan CLOs 'CCC' exposure increased in December to 5.8%. Meanwhile, European exposure to obligors rated 'CCC' also increased, but to a lesser extent.
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