Global credit quality is still deteriorating but is doing so at a reduced rate in the second quarter, according to Moody’s Investors Service.
The proportion of corporate downgrades to upgrades has declined from just under four-to-one to just under three-to-one. While 1.3% of issuers received upgrades in the first quarter, this figure rose to 1.9% for the past three months; this has lowered the downgrade-upgrade ratio.
More worryingly for the global economy is news that ratings in the high quality Aa category fluctuated strongly, with downgrades outweighing upgrades by a ratio of six-to-one: the highest ratio in any ratings category.
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