This report does not constitute a rating action.
NEW YORK (S&P Global Ratings) Oct. 4, 2022--The Financial Fragility Indicator (FFI) plummeted to -0.05 in the second quarter and is now on the precipice of the historical average, or zero. This indicates that financial conditions have weakened dramatically, and conditions are pointing to rising financial fragility in 2023, said S&P Global Ratings in its article, "Financial Fragility Indicator Deteriorates Rapidly As Household And Firm Balance Sheet Weakness Approaches Historical Average," published today.
Both the household and nonfinancial corporate sectors experienced deteriorating financial conditions, with quarter-over-quarter declines of 83% and 103%, respectively.
Leverage risks and liquidity risks for both sectors worsened, deteriorating net wealth.
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|U.S. Chief Economist:||Beth Ann Bovino, U.S. Chief Economist, New York + 1 (212) 438 1652;|
|Contributor:||Joseph Arthur, Iowa City|
|Research Contributor:||Shruti Galwankar, CRISIL Global Analytical Center, an S&P affiliate, Mumbai|
|Media Contact:||Jeffrey Sexton, New York + 1 (212) 438 3448;|
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