U.S. corporate high-yield defaults rose to 2.99% last year from 1.35% in 2022, according to Fitch Ratings. It expects the rate to increase to a 5% to 5.5% range this year, driven by elevated interest rates and slower economic growth.
High-yield default rate increases, spreads narrow
The Bloomberg U.S. Corporate High Yield index's spread is 353 basis points. That's 116 basis points narrower than the spread at the end of 2022. The index has an 8% yield compared with nearly 9% in December 2022.
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