Fitch: Credit Markets Still Deteriorating

Equity markets continued to signal credit deterioration, with the five-year Probability of Default (PD) Index moving out across all sectors, another 3% on average, according to Fitch Ratings.

“Although clearly calmed by EU and IMF bailout efforts, much uncertainty remains in the credit markets, thereby making continued volatility in CDS spread likely.”

Fitch Ratings


“Globally, CDS spreads tightened 7.4% last week after widening substantially the week before. Despite the CDS tightening, CDS IR downgrades outnumbered upgrades 4.5 to one, as four consecutive weeks of CDS widening resulted in 168 issuers establishing wider trading patterns. Although clearly calmed by EU and IMF bailout efforts, much uncertainty remains in the credit markets, thereby making continued volatility in CDS spread likely,” the rating agency says.

Equity markets continued to signal credit deterioration, with the five-year Probability of Default (PD) Index moving out across all sectors, another 3% on average.

Full post and copy of the latest update from Fitch at The Swapper.

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