Pace of high-yield credit deterioration slows to late-2000 levels, Moody's says

New York, Aug. 9 - The rate of deterioration in high-yield credit quality has slowed to levels last seen in the third quarter of 2000, Moody's Investors Service said Friday.

For the third quarter so far, the downgrade-to-upgrade ratio for high-yield credits is 2.6:1 compared to 4.4:1 for the second quarter.

The last time the ratio was at or below 2.6:1 for an entire quarter was in the third quarter of 2000, Moody's added.

For all credits, both speculative and investment-grade, the ratio is 3.1:1 for the third quarter so far compared to 4.9:1 for the second quarter, Moody's said. There have been a total of 16 upgrades and 49 downgrades.

Since the end of June, telecommunications, high technology and energy trading has been involved in 39% of all downgrades. Without those sectors the ratio is 1.9:1 for the third quarter so far compared to 4.0:1 for the second quarter.

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