Companies around the world are defaulting on their debt at the fastest pace since the global financial crisis as high interest rates and stubborn inflation continue to take their toll, according to a report from S&P Global Ratings, MarketWatch.com reported. According to S&P, the number of corporate defaults has climbed to 29 since the start of the year, the most highest tally at this point in a year since 2009. While the majority of defaults occurred in the U.S., an uptick in European bankruptcies is alarming analysts. Since January, eight European companies have defaulted, more than double the three defaults that had been seen by this point in 2023. By comparison, 17 defaults occurred in the U.S., slightly less than the 18 seen at this juncture from last year. While the U.S. has seen a plurality of defaults, Europe has seen companies fail to make payments on their debt obligations at twice the rate of any year since 2008. By sector, 40% of defaults in February have involved companies in the health care or media and entertainment spaces. Given their weak outlook, S&P Global expects more media and health-care companies, along with makers of consumer products, to see more defaults going forward.
