IIF: Global corporate debt hit record high in 2018 H2 - Reuters
|In a cautionary note from the Institute of international Finance, Reuters explains that non-financial corporate debt has hit a new record high as a decade of businesses borrowing their way out of recession continues,
Key quotes
Debt among non-financial corporations across the globe rose to a record high of $75 trillion in the second quarter, driven mostly by China and the United States, the Institute of International Finance said in a report.
“China’s corporate sector has some of the highest debt levels in the world,” the report, dated Tuesday, stated, though it said businesses based in the world’s second-largest economy also have significant “cash holdings (that) provide an important cushion against risk.”
Canada, India and Mexico rank first in nonfinancial corporate debt relative to cash holdings, the report said, while a “significant proportion” of Brazilian, Canadian, American and Chinese corporations still struggle to pay interests on their debt.
Bankers, executives and investors have warned the U.S. central bank that record leveraged lending to companies from lightly regulated corners of Wall Street could make any economic downturn harder to manage.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.