The Big Picture
2018 Global Credit Themes

The Big Picture presents research on six themes shaping credit in 2018: Growth, Financial Stability, Political & Geopolitical Risk, Technology & Innovation, Climate Change & Sustainability, and Demographics.

Explore our Credit Themes
Growth
Financial
Stability
Political &
Geopolitical Risk
Technology
& Innovation
Climate Change
& Sustainability
Demographics
launch credit themes video
Highlights
CROSS-SECTOR
/
20
September
2018
Post-election credit quality in Brazil will take cues from policy continuity or disruption
Brazil’s credit quality after October’s presidential election, and the credit quality of its banking, infrastructure and corporate sectors, will depend on the new administration working with congress to achieve much-needed fiscal reforms. Policy continuity would sustain the country’s economic growth and help stabilize government debt levels, while policy disruption would risk triggering a negative feedback loop that undermines investor confidence and the recovery itself.
Highlights
Cross-sector
/
13
September
2018
Probability of a 'no-deal' Brexit has risen and would be credit negative for a range of issuers
If the UK were to exit the EU without an agreement to preserve many of the current trading arrangements – a “no-deal” Brexit – the UK economy, UK-based issuers in various sectors, and the economies of certain EU member states would face significant credit challenges.
Highlights
CROSS-SECTOR
/
22
August
2018
Growth will remain solid in the near term, but early indications suggest it has peaked
Growth prospects for many of the G-20 economies remain solid, but there are indications that the synchronous acceleration of growth heading into 2018 is now giving way to diverging trends.
Growth
CROSS-SECTOR
/
19
September
2018
New US tariffs on $200 billion of imports are credit negative for Chinese and US companies

The new tariffs mark a significant escalation of the ongoing trade dispute between the two countries and apply to a broad spectrum of Chinese products.

Cross-sector
/
12
September
2018
State of the US Consumer: Trends & credit implications

In a new quarterly report, we examine trends in US consumer strength and find continued strong employment is underpinning US consumption – a key driver of economic growth. Although wage trends have been mixed, we expect broadly upward momentum.

CROSS-SECTOR
/
29
August
2018
India’s robust growth and domestic savings mitigate fiscal and external pressure from higher oil prices and interest rates

Higher oil prices and rising interest rates will have varying credit implications for the Indian sovereign and banking sector.

Financial Stability
Sovereign
/
18
September
2018
Renminbi depreciation has no immediate credit impact; expanded policy tools to manage rise in volatility over time

If a longer-term shift in China's current account into structural deficit prompts more frequent intervention in the renminbi, that could put credit-negative pressure on currency reserves.

Cross-Sector
/
14
September
2018
Turkey’s forced redenomination of property contracts is credit negative, offsetting benefit of rate hike

President Erdogan’s executive decree that all property contracts between Turkish entities or citizens be denominated in Turkish lira more than outweighs the positive impact of the Turkish central bank's decision to raise interest rates to 24% from 17.75%. Risks to Turkey’s domestic and external financial stability therefore remain elevated.

CROSS-SECTOR
/
13
September
2018
Indonesian issuers will face credit challenges if rupiah depreciates further

Indonesia’s strengthened policy framework is containing credit risks associated with the rupiah’s rapid decline. But additional currency weakness would have economy-wide credit-negative effects.

Political & Geopolitical Risk
CROSS-SECTOR
/
31
August
2018
Ineffective policy response to Turkey’s recent financial stress and rising external financing risks affect domestic issuers

Domestic issuers' high exposure to Turkey’s macroeconomic environment and banking system means they will likely face adverse impact if credit pressures in the sovereign environment persist.

SOVEREIGN AND SUPRANATIONAL
/
29
August
2018
Mexico's agreement with the US on NAFTA revisions reduces trade-related uncertainty, a credit positive

Diminished trade-related uncertainty will support Mexico's near-term growth and investment prospects.

SOVEREIGN AND SUPRANATIONAL
/
27
August
2018
Fresh US sanctions have little credit impact on Russia, but more stringent measures possible later this year pose credit risks

New sanctions are limited in scope, but other US measures being considered on sovereign debt, the energy sector or state-owned financial institutions would weigh on Russia's growth potential.

Technology & Innovation
FINANCIAL INSTITUTIONS
/
20
September
2018
Korea's managed fintech development approach is credit positive for the country's financial institutions

Korean financial institutions actively pursuing digital strategies will benefit from the new opportunity to test innovative fintech services in a controlled regulatory environment.

INFRASTRUCTURE AND PROJECT FINANCE
/
17
September
2018
Cyber risk is on the rise for US utilities, but the likelihood of government relief is high

US utilities' exposure to cyber risk is growing. The extent and duration of a cyber-triggered outage, its financial impact, and ensuing governmental support will drive the credit impact.

FINANCIAL INSTITUTIONS
/
16
September
2018
Mexico's new fintech norms are credit positive for banks

The new legislation will reduce risks associated with acquiring or partnering with fintech firms.

Climate Change & Sustainability
Infrastructure and Project Finance
/
18
September
2018
Default and recovery rates for project finance bank loans, 1983-2016: Green projects demonstrate lower default risk

This study compares the credit performance of green vs non-green projects, and projects with availability-based vs non-availability-based revenues.

Corporates
/
17
September
2018
Regional effects on homebuilding from Hurricane Florence, but no expectation of significant damage to operating results

Many of the homebuilders we rate have operations in the Carolinas, but we do not expect damage from Hurricane Florence to significantly hurt their results.

Infrastructure & Project Finance
/
17
September
2018
California will consume only carbon-free electricity by 2045, a credit negative for utilities and generators

The law means that the state will no longer accept energy from generators with fossil fuel plants, and exposes utilities to the unpredictability of solar and wind generation.

Demographics
CROSS-SECTOR
/
18
September
2018
High US healthcare costs strain governments, businesses and households, with ripple effects across the economy

The increase in costs is pressuring public sector budgets, weighing on business competitiveness and straining household finances.

Financial Institutions
/
18
September
2018
Demographic changes will bring new challenges and opportunities to Asia Pacific banks in the next decade

Demographic changes will pose new challenges for banks in Hong Kong, Japan, Korea and Taiwan, while bringing opportunities for those in India, Indonesia and the Philippines.

CROSS-SECTOR
/
10
September
2018
Population growth drives need for new infrastructure investment in Australia

Most infrastructure investment will occur in the east-coast states in which population growth is concentrated, and will remain largely state-led. But the private sector will also play a role.

Upcoming events
SEE ALL EVENTS »
AMERICAS
+1.212.553.1653

EMEA
+44.20.7772.5454

ASIA PACIFIC
+852.3551.3077

JAPAN
+81.3.5408.4100