The number of corporate issuers Moody's rates B3 negative or below as a percentage of the high-yield universe have been on the upswing for the last year. As of Oct. 1, the figure was 16.1%, flat from the prior month but up significantly from a year ago when it was 11.3%.
During the Great Recession and at the onset of the COVID-19 pandemic in 2020, the rate was over 20%. Since the start of 2007, the high was 27.5%, reached in July 2020.
The high-yield default rate was 4.9% at the start of the month vs. 1.45% a year ago.