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Global Debt Leverage: Spreads, Costs Shocks May Double Rate Of Loss-Making

While companies’ pushing out of debt maturities has cushioned them against interest-cost rises, our stress test of more than 10,000 global corporates indicates that a twin shock of 1970s-style cost inflation and spreads at the level of the Global Financial Crisis could almost double potential defaulters, to 12%, by 2023—with the share of "highly indebted" companies reaching almost 40%.


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