US high yield defaults seen to stay at 4% in 2016

New York

THE fresh stretch of softness in commodity prices since early December has been at the epicentre of exploding junk bond spreads, causing many investors to doubt the ability of companies to service their debt.

2015, according to credit strategists at Societe Generale, was a year of pricing in rising default risk. But will 2016 be a year in which these drillers in distress are completely overwhelmed by debt?