Here are the top highlights from this week's edition of Moody's Credit Outlook:
First Reads
A US federal court ruled that Google is not required to divest its Chrome web browser or Android OS, as the Justice Department sought. Instead, the company must change behaviors including those involving exclusive rights, access, data sharing and AI. Meanwhile, US tariffs are weakening European steel demand, delaying the industry’s recovery to 2026. Overcapacity and high imports remain key risks to earnings and credit quality.
Featured News and Analysis
EU merger review could support telecoms M&A, which would be credit positive
The review to update the framework for assessing mergers is particularly important to Europe’s telecoms, which have lacked consolidation, leading to fragmented markets and competition that weighs on profitability and credit quality.
Sumitomo's $2 billion acquisition of Air Lease will enhance its existing aircraft leasing portfolio
The acquisition will complement Sumitomo's existing aircraft leasing business, while Air Lease's relatively young fleet is likely to generate consistent returns over the next two to three years. And, the combined assets of the two companies will improve efficiency and enhance competitiveness.
Thailand's removal of second prime minister in a year highlights persistent political instability
The ouster of Thailand’s prime minister by the country’s Constitutional Court is symptomatic of the persistent political uncertainty that plagues the country, weighing on longer-term economic growth and weakening the country’s fiscal position.
Credit in Depth
Private debt markets in the US and Europe are primed to seize the accelerating calls for capital created by deglobalization as countries push toward greater self-sufficiency. But rapid new growth also increases risks around competition, leverage and transparency.
How and when might AI substantively alter companies’ business models, costs, productivity, and ultimately their credit quality? We set out three scenarios of how AI could evolve through to 2030, each with implications for investment needs, competitive positioning and credit risk exposure.
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