US Financial Stability Improves Despite Easy Policy (Capital Markets Research)

WEEKLY MARKET OUTLOOKAUGUST 25, 2016CAPITAL MARKETS RESEARCHUS Financial Stability Improves Despite Easy Policy Credit Markets Review and Outlook by Ben Garber US Financial Stability Improves Despite Easy Policy.¯ FULL STORY PAGE 2The Week Ahead We preview economic reports and forecasts from the US, UK/Europe, and Asia/Pacific regions. ¯ FULL STORY PAGE 6The Long View Check our chart here for forecast summaries of key credit market metrics. Full updated stories, Second-half 2016 issuance of US$ high grade and spec-grade bonds may grow by 20% annually, begin on page 16.¯ FULL STORY PAGE 16Ratings Round-Up by Njundu Sanneh Upgrades, but Not for Prisons.¯ FULL STORY PAGE 20Market Data Credit spreads, CDS movers, issuance.¯ FULL STORY PAGE 22Moodys Capital Markets Research recent publications Links to commentaries on: Retail, Portugal, overvalued, Pakistan, productivity, gold, Venezuela, economy, Italy, pricey, borrowing, Turkey, shareholders, Brexit, yields, bondholders. ¯ FULL STORY PAGE 26Credit SpreadsInvestment Grade: Year-end 2016 spread to be close to its recent 142 bp. High Yield: After recent spread of 534 bp, it may approximate 610 bp by year-end 2016. Defaults US HY default rate: after July 2016s 5.5%, Moodys CreditPolicy Group forecasts 6.3% by Q4 2016.Issuance For 2016, US$ IG bond issuance may increase by 8.6% to a record $1.44 trillion, while US$ high-yield bond issuance may sink by -8.0% to $325.5 billion.Click here for Moodys Credit Outlook, our sister publication containing Moodys rating agency analysis of recent news events, summaries of recent rating changes, and summaries of recent research.Moodys Capital Markets Research, Inc.Weekly Market Outlook Contributors: David W. Munves, CFA 1.212.553.2844 david.munves@moodys.com John Lonski 1.212.553.7144 john.lonski@moodys.com Ben Garber 1.212.553.4732 benjamin.garber@moodys.com Njundu Sanneh 1.212.553.4036 njundu.sanneh@moodys.com Yukyung Choi 1.212.553.0906 yukyung.choi@moodys.com Irina Baron 1.212.553.4307 irina.baron@moodys.com Franklin Kim 1.212.553.4419 franklin.kim@moodys.com Xian (Peter) Li1.212.553.1404 Xian.li@moodys.comMoody's Analytics/Europe: Tomas Holinka +420 ( 221) 666-384 Tomas.holinka@moodys.comMoody's Analytics/Asia-Pacific: Alaistair Chan +61 (2) 9270-8148 Alaistair.Chan@moodys.com Emily Dabbs +61 (2) 9270-8159 Emily.dabbs@moodys.comEditor Dana Gordon 1.212.553.0398 dana.gordon@moodys.comMoodys Analytics markets and distributes all Moodys Capital Markets Research, Inc. materials. Moodys Capital Markets Research, Inc is a subsidiary of Moodys Corporation. Moodys Analytics does not provide investment advisory services or products. For further detail, please see the last page.CAPITAL MARKETS RESEARCHCredit Markets Review and OutlookCredit Markets Review and Outlook By Ben Garber, Economist, M...