Moody's: Default risk rises for high-yield APAC corporates on slowing growth, trade policy uncertainty

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Moody’s Investors Service is out with a fresh report, assessing the impact of the China coronavirus on the Asia-pac (APAC) corporates and the global economy.

Key Quotes:

Default risk rises for high-yield APAC corporates on slowing growth, trade policy uncertainty.

Asian high-yield non-financial corporate default rate will increase in 2020.

Expect global economic growth to remain sluggish in 2020 with pessimistic business sentiment and trade policy uncertainty.

Market Implications: 

The market mood remains buoyed in Asia after China’s Hubei reported a drop in new coronavirus cases to 4,823 on Thursday, down significantly from Wednesday’s 14,840. Therefore, the above headlines failed to hamper the risk-on trades, as USD/JPY trades better bid around 109.85 amid an uptick in the S&P 500 futures.