The global speculative-grade default rate has fallen by more than 75% in the second quarter of 2003, according to Moody's, the ratings agency. Twenty-one of Moody's rated corporate bond issuers have defaulted on $8.9 billion of debt; this compares to $42 billion for the same period in 2002.
And the annual figures also look promising. The yearly figure for corporate default in 2003 stands at $19 billion; the corresponding figure for 2002 was $76 billion.
This is also reinforced by a fall in the global speculative-grade default rate, dropping to 6% in the second quarter, falling from 7% in the first quarter. Moody's also reports that as a percentage of dollar volume, the default rate fell from 16.4% in the first quarter to 9% in the second.
Europe leads the way as default rates fall from 19.5% to 10.9% in the second quarter, while the US global speculative-grade default rate remains constant through the first two quarters.