Financial Times FT.com

Default rates fail to detect cold front approaching

By David Oakley and Michael Mackenzie

Published: February 7 2008 02:00 | Last updated: February 7 2008 02:00

Sometimes a number can be misleading. Global default rates for heavily indebted companies are close to all-time lows, suggesting all is well with the corporate world in spite of a severe credit crunch and a looming US recession.

This was confirmed by the latest figures from Moody's yesterday, which showed the global default rate for high-yield companies is currently standing at 1.1 per cent - around 26-year lows.

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