America’s most leveraged companies got a painful reality check this week when Federal Reserve Chairman Jerome Powell warned that a rate cut is still a couple of years away.
Companies will have to swallow higher borrowing costs for longer while finding a way to manage their liabilities. Rising funding costs increase the risk of defaults and distressed exchanges as firms struggle to adapt to a shrinking money supply.
Read More : Powell’s Wake-Up Call Points to Increased Corporate Defaults: Credit Weekly