Credit default looming across the globe

S&P Report - S&P Global Ratings has reviewed over two-thirds of its sovereign ratings globally since early March, when lockdown measures started pushing economies across the world into severe recessions. They have lowered over one-fifth of ratings, and five of those ratings currently have negative outlooks, while revised the outlooks on 15% of the reviewed sovereigns to negative from stable. Across all 135 rated sovereigns, the outlook balance is firmly tilted to the downside. There are 10 downgrades in the American region and 8 from Europe, the Middle East, and Africa (EMEA) region period from March to 1st week of May 2020. In some cases, particularly in Latin America and Africa, the economic and fiscal outlook prior to COVID-19 was already quite weak. For some of these economies, the erosion of credit quality stemming from the effects of the pandemic will be structural and long-lasting.