>The trailing 12 month global speculative-grade corporate default rate continues to decline, finishing the fourth quarter of 2011 at 1.7%, slightly down from 1.8% in the previous quarter and 3.2% a year ago.
In the U.S., the speculative-grade default rate edged lower from 2.0% in the third quarter to 1.8% in the fourth quarter, but in Europe the default rate almost doubled from 1.4% to 2.7%. A year ago, the default rate was higher at 3.4% in the U.S. but lower at 2.3% in Europe.
… the global speculative-grade default will rise to 2.9% by the end of 2012. … the global default rate could rise to as high as 8.5% in a pessimistic scenario if the U.S. recovery stalls and the European debt crisis deteriorates materially.
By region, … the default rate will climb to 2.8% in the U.S. by end of 2012 under its baseline scenario, versus 3.7% for Europe. Across industries over the coming year, … default rates to be highest in the consumer services sector in the U.S. and the business services sector in Europe.