Higher Borrowing Costs To Weigh On Global Credit Conditions In 2027: Moody’s

Higher Borrowing Costs To Weigh On Global Credit

Global credit conditions are expected to weaken in 2027 as higher financing costs, persistent economic uncertainty and geopolitical risks weigh on borrowers and lenders, according to Moody's. The rating agency has flagged rising borrowing costs as a key challenge for businesses, governments and households, with tighter financial conditions likely to increase debt-servicing pressures and constrain access to credit.

Moody's Ratings' 2027 Global Credit Conditions Outlook report examines the key forces that could shape credit markets in the year ahead.

AI investment will remain massive, but investors will increasingly focus on whether revenues and productivity gains justify the scale of spending. Business model disruption will become more visible: some companies will gain from stronger demand and productivity, while others face more competition and weaker pricing power," Moody's Ratings said.

Besides, Moody's expects government intervention through tariffs, regulation, export controls and strategic investment to play a growing role in credit outcomes.

The outlook points to a more challenging environment for borrowers as elevated interest rates and refinancing costs make it harder to manage existing debt and raise fresh funds.

Companies with high leverage and weaker cash flows could face greater pressure, while governments may…

Original source: https://www.timesnownews.com/business-economy