S&P U.S. junk default rate declines to estimated 1.94% in September

By Caroline Salls

Pittsburgh, Oct. 3 - Standard & Poor's said its 12-month trailing speculative-grade default rate fell to an estimated 1.94% in September, the lowest level since April 2008, according to the article, "U.S. Credit Metrics Monthly: Default Rate Declines To An Estimated 1.9% in September."

The trailing 12-month U.S. junk default rate was 2.09% in August.

S&P said U.S. defaults are still rare, despite continued weakness in the U.S. economy and lingering uncertainty in the financial markets.

"Only one U.S. company, NewPage Corp., defaulted in September," S&P's Diane Vazza said in the release.

The ratings agency said the U.S. default rate has been declining steadily since the end of 2009.

However, S&P said in the article, the default rate is a lagging indicator and an increase usually results from sustained deterioration in both market fundamentals and economic growth.

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