NEW YORK--(BUSINESS WIRE)--Kroll Bond Rating Agency (KBRA) has released a macro-market research report, “Global Economies: Debt and More Debt.” The report discusses aggregate increases in indebtedness since the Great Recession across both emerging and advanced economies. It highlights that the growth in debt has followed different paths; whereas in advanced economies, leverage ratios have broadly stabilized in recent post-crisis years (2013-2016), for emerging-market economies, debt in relation to GDP has grown steadily over the period 2007-2016 across economic sectors.
The near-to-medium-term environment is likely to be characterized by rising interest rates, especially as advanced economies extricate themselves from unorthodox crisis-related monetary policy. This will feed into generally higher borrowing costs for emerging markets as a whole. Debt-service risks will vary, depending upon debt composition, currency movements, and the outlook for economic performance – all economy-specific factors. Overall, foreign-currency reserve accumulation has not kept pace with the growth in the stocks of external debt, and external debt stocks have risen compared to current account earnings.
To read the full report, click here.
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