Ted Hampton of the US Public Finance team discusses how the State of Illinois is weathering COVID-19’s financial difficulties while pension obligations continue to weigh on its credit quality. Plus, Earl Heffintrayer and Myra Shankin of the Project and Infrastructure Finance team weigh in on the US airport sector’s improving prospects as passenger levels pick up.​

High-frequency alternative data indicate a strong rebound in global economic activity even as COVID-19 infection rates rise and restrictive measures remain in place across many countries. Vaccinations in G-20 countries are advancing and the number of fatalities from the virus has declined in recent weeks. Financial conditions remain supportive in the US and euro area but are tightening across some emerging markets.

After a merger with a publicly traded special purpose acquisition company (SPAC), corporate issuers generally emerge with stronger credit quality, at least initially, with lower debt and improved liquidity. However, the final capital structure can result in significantly higher debt or weaker liquidity if the sponsor cannot find private investors to make up for high redemption rates.