Recession Risks
Many large economies will likely enter recessions in 2020. The coronavirus outbreak, the steep fall-off in business activity and sharp drop in oil prices are creating unprecedented shocks around the world.
  • SUMMARY
  • REPORTS

  • Podcast
    29 May 2020|Moody's Investors Service
    David Keisman and Julia Chursin discuss why US corporate defaults during the pandemic are likely to produce bigger losses for investors. Erosion in credit quality, structure and covenants will suggest worse debt recoveries for first-lien bank debt in particular. Meanwhile, the prevalence of distressed debt exchanges will not be sufficient to stave off subsequent defaults if the downturn’s duration is protracted.​ >> View report
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    SECTOR IN-DEPTH
    28 May 2020|Moody's Investors Service
    High frequency and alternative data indicators in May indicate the economic shock from the coronavirus pandemic will be concentrated in the second quarter, in line with our expectations. We forecast a slow recovery in the second half of the year for most economies.

    SECTOR IN-DEPTH
    21 May 2020|Moody's Investors Service
    Alternative data indicators show a nascent recovery in global trade, and certain economies’ employment. Daily financial data in May show tightening spreads, increased lending and lower equity market volatility in the US and euro area.

    18 May 2020|Moody's Investors Service
    The coronavirus crisis is depressing consumer demand, disrupting global supply chains and spurring export restrictions on medical and food supplies. In addition, the pandemic will complicate and possibly delay US-China “phase two” trade negotiations and UK-EU and US-EU negotiations.

    SECTOR IN-DEPTH
    14 May 2020|Moody's Investors Service
    Strong central bank actions prompted a rebound in US and European financial markets in early May, in contrast with a continued deterioration in economic activity, according to alternative data indicators. The latest job openings data show deteriorating employment trends in the US but an accelerating recovery in China.

    SECTOR IN-DEPTH
    14 May 2020|Moody's Investors Service
    Even as the US economy gradually reopens, the effects of coronavirus-related business closures and the deterioration in employment will continue to constrain consumption in the current quarter and for the rest of the year.

     

    SECTOR IN-DEPTH
    07 May 2020|Moody's Investors Service
    Major Latin American economies have put in place coronavirus support measures that include cash payments to low-income households, liquidity support for businesses and tax deferrals. But this support will not offset the rising recessionary momentum in the region or credit risks for most sectors.

    SECTOR COMMENT
    01 May 2020|Moody's Investors Service
    We project the US unemployment rate will reach 15.0% in the current quarter, as much of the economy remains shuttered. The rate will begin to taper off in the third quarter and continue to fall in each subsequent quarter through the end of 2021, provided the coronavirus crisis eases and businesses gradually resume normal operations.

    OUTLOOK
    30 Apr 2020|Moody's Investors Service
    For the first time since 2008, positive industry sector outlooks vanished in the first quarter as coronavirus, travel restrictions, social distancing and an oil price shock pushed 20 of the 52 industry sector outlooks that we track in a negative direction.

    SECTOR IN-DEPTH
    30 Apr 2020|Moody's Investors Service
    The speculative-grade default rate for emerging market companies will likely rise significantly by the end of the year. We base our forecasts on the expectation of a global recession and widening high-yield spreads, as coronavirus-induced economic disruption and financial market turmoil have intensified.