Credit Conditions
Our regional and global Credit Conditions Committees—and the research publications we produce—provide financial market participants around the world with an essential resource for identifying and understanding prevailing and potential credit risks.
Assessing Global Macro-Credit Risks
As an assessment of the external operating environment, our regional and global Credit Conditions Committee forums—covering Asia-Pacific, Emerging Markets, Europe, and North America, which cascade into our global coverage—form an integral part of S&P Global Ratings’ credit rating analysis.
At the CCCs, our senior researchers, economists, and analysts (covering corporates, financial institutions, insurance, structured finance, sovereigns, and U.S. public finance) meet each quarter to evaluate the trends affecting the current and future states of economies, industries, and credit markets. The CCCs identify base case and downside scenarios, and rank exogenous risks. These views are cascaded to our analytical teams to inform their rating deliberations.
Our quarterly and special CCC reports crystallize the Committees’ conclusions, backed by a host of proprietary data, and with an eye toward helping investors make decisions—providing financial market participants around the world with a primary resource for identifying and understanding prevailing and potential credit risks.
Global
Global Credit Conditions Q2 2026: Narrow Strait, Broad Implications
We expect credit conditions to weaken in the next 12 months. We believe the war in the Middle East may be the catalyst that finally pushes the credit cycle--and the prolonged favorable financing conditions--to turn.
The duration of the war will determine whether the deterioration is contained or broad.
Even if the effective closure of the Strait of Hormuz eases in the coming weeks, the conflict to-date has neutralized expected upside pressures to growth.
North America
Credit Conditions North America Q2 2026: War Compounds Pressures
The prospect of a protracted or wider war in the Middle East is further narrowing the path of favorable credit conditions for borrowers in North America, compounding downside risks including a potential economic slowdown, continued policy uncertainty, the still-unfolding AI-related transition, and a buildup in pressure in private credit.
Europe
Credit Conditions Europe Q2 2026: Supply Strains, Credit Pains
Geopolitical risks cloud the European macro-credit outlook, which started the year fairly positively. Supply chain disruptions could increase inflation, tighten credit conditions, and impair earnings, particularly for energy-intensive industries. We therefore lowered our 2026 eurozone growth forecast to 1% and raised our inflation forecast to 2.4%.
Asia-Pacific
Credit Conditions Asia-Pacific Q2 2026: Choke Point To Stress Points
While Asia-Pacific's growth and financing conditions entered 2026 on a strong footing, three factors may reverse that narrative: 1. A widening Middle East conflict is turning into an energy shock and supply-chain crisis with a largely closed Strait of Hormuz; 2. U.S. trade policy uncertainty still complicates the export environment for Asia-Pacific's businesses; and 3. AI-driven disruptions may displace traditional industries.
Emerging Markets
Credit Conditions Emerging Markets Q2 2026: The Clock Is Ticking
Geopolitical tail risks are growing for emerging market credit conditions with the Middle East war and effective closure of the Strait of Hormuz threatening energy availability across emerging markets. While EMs can absorb temporary price shocks, sustained supply disruptions would undermine purchasing power, pressure fiscal and external balances, and heighten social risks, especially in net energy importing economies in EM Asia and Africa.
Credit Cycle Indicator
Q2 2026: The Middle East War Could Accelerate Credit Deterioration
The global Credit Cycle Indicator (CCI) has slightly decreased and is now close to its long-term average. This signals a potential credit deterioration later this year. The Middle East war has led to a decline in equity prices, rise in yields, and hike in market volatility. Amid ongoing trade policy uncertainty and risks around AI-related investment and disruptions, a sustained conflict with global economic repercussions (such as higher inflation, slower growth, or recession) could further weigh on credit conditions.
Latest Research
Take a look at all of our latest credit conditions research.