Politics poses biggest risk to European credit

Potential crisis around trade, Brexit and Italy’s government could cause trouble for credit markets.

Political issues, rather than underlying business performance, pose the biggest threat to European credit markets, according to an analysis by S&P Global.

In its European Corporate Credit Mid-Year Outlook report, S&P Global said market metrics appeared relatively benign, with 12-month trailing default rates of around 2 percent and it forecast this was unlikely to rise beyond 3 percent over the next year.

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