Standard & Poor’s Global Ratings has raised its forecast for global debt issuance growth in 2024, supported by the possibility of continuing the positive momentum witnessed in the third quarter.
The agency expected in a recent report that total global debt issuance; including corporate bonds, local entities, and structured debt will increase by 17%, to $9 trillion by the end of 2024.
This is in comparison to the agency’s expectations last July, when global debt sales would increase annually by 9% to nearly $8.3 trillion, according to Bloomberg.
Moreover, Standard & Poor expects debt issuances to slow in 2025 to an increase of only 4%, due to the expected increase in the base year and the slowdown in global economic growth.
Whereas, credit analysts at the agency said borrowers would welcome even modest interest rate cuts in 2025, after years of rapid rate hikes by central banks, adding that easing borrowing costs could encourage mergers and acquisitions and other debt-financed growth and expansion plans.
To conclude, the report noted that the risks to the agency’s 2025 forecasts are threats to global trade, which in turn could weigh on inflation, prompting central banks to slow or reverse monetary easing efforts.
