Fitch Sees US Junk Bond Default Rate 4.5%-5% to End 2023

The default rate for US junk bond issuers will trend higher over the remainder of the year, ending 2023 within a range of 4.5% to 5.0% amid tighter lending conditions and high interest expenses, according to a Fitch Ratings report Wednesday.

• Defaults by issuer count were 2.0% in May, up from 1.9% in April, the ratings firm wrote June 14
• Fitch also sees more limited capital access due to stress in the banking sector and inflation uncertainty
• Mallinckrodt Pharmaceuticals was added to Fitch’s “Top Market Concern Bond” list, which consists of high-yield issuers expected to default within two years, amid ...