S&P Global data show weekly credit downgrades jump as risky issuers increase
Credit quality weakened across several sectors last week as downgrades rose sharply and upgrades retreated. The consumer products sector recorded the most downgrades, while U.S.-based issuers accounted for most of the negative rating actions and all of the upgrades.
Highlights
- S&P Global Ratings reported 14 downgrades last week, doubling from the prior week, while upgrades fell to three from 10.
- Consumer products sector saw the most downgrades at three, with U.S.-based issuers responsible for nine downgrades and all three upgrades.
- Risky credits increased to three last week from one, including Sweden's Polygon Group AB, signaling mounting stress among lower-rated borrowers.
Weekly rating actions across sectors
As reported by S&P Global, citing S&P Global Ratings, downgrades doubled to 14 last week, the highest weekly total since the end of April, while upgrades declined to three from 10 a week earlier. Rating actions span multiple sectors, with consumer products posting the largest number of downgrades at three.U.S.-based issuers account for nine of the downgrades and all three upgrades in the latest weekly tally. The figures point to a weaker near-term credit backdrop as negative rating pressure outpaces positive actions.
Risk signals rise for issuers
New risky credits increased to three last week from one in the previous week, adding to signs of mounting stress among lower-rated borrowers. Among them, Sweden-based Polygon Group AB was downgraded on elevated leverage and liquidity risk.S&P Global Ratings also downgraded U.S.-based entities as part of the increase in risky credits. The rise in such credits suggests pressure is spreading across issuers as financing and balance-sheet risks remain in focus.
S&P Global Ratings’ warning on rising sovereign borrowing risks highlighted how persistent geopolitical tensions and elevated fiscal spending are straining governments in a higher-rate environment. Our earlier coverage noted that emerging and frontier markets are especially exposed due to heavier interest-service burdens and narrower revenue bases, with inflation and refinancing costs adding pressure to sovereign credit profiles.
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