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Rising Rates Test $1.8 Trillion Credit Market
16 Mar
Summary
- Global private credit market faces growing stress.
- Asset class expanded amid low rates, now faces higher costs.
- Borrowers with floating-rate loans are increasingly challenged.
The rapidly expanding $1.8 trillion global private credit market is showing signs of stress, though not yet indicating a systemic crisis.
Over the last decade, private credit emerged to fill gaps left by banks. This growth occurred during a period of historically low interest rates and abundant liquidity.
The current higher-rate environment is now testing the resilience of many borrowers. Those with floating-rate loans are finding their debt servicing costs have significantly increased.
Disclaimer: This story has been auto-aggregated and auto-summarised by a computer program. This story has not been edited or created by the Feedzop team.
