Egan-Jones

How will Trump’s second term reshape global credit markets? From trade wars to fiscal policy shifts, Egan-Jones dives into the implications for U.S. and international credit ratings: https://lnkd.in/d2ae6Rid 

The rise of AI in finance is revolutionizing trading, risk management, and credit ratings. Learn how innovations in data analysis and automation are redefining the future of financial markets: https://lnkd.in/dT6tTBtt 

Germany’s central bank has slashed its 2025 growth forecast to 0.2% and warns of risks from rising trade protectionism and geopolitical tensions. Struggling with industrial sector challenges, weak exports, and consumer confidence, Germany faces further strain from potential U.S. tariffs and ongoing structural issues, including its shift to electric vehicles and weakened labor market. Image credit: Bloomberg

China's economy faces mounting challenges as government stimulus efforts struggle to boost growth amid weak consumer spending, a prolonged property slump, and potential U.S. trade tensions under President-elect Trump. Beijing has pledged additional borrowing, rate cuts, and measures to stabilize markets, but economists remain skeptical about a sustained recovery without deeper reforms to the fiscal system and social safety net. Image credit: Statista

Donald Trump and SoftBank CEO Masayoshi Son are set to announce a $100 billion investment in U.S. projects over four years, aiming to create 100,000 AI-focused jobs before Trump’s term ends in 2029. While the plan bolsters Trump’s economic agenda, questions remain about how SoftBank will fund the commitment, given its history of high-profile investment challenges. 

The Egan-Jones Ratings Portal offers trusted credit ratings, research, and market tools. Explore the insights that matter today: https://www.egan-jones.io/ 

Walgreens Boots Alliance, once valued at over $100 billion, is in discussions with Sycamore Partners for a potential sale as it grapples with heavy losses following its investment in VillageMD. Image credit: AI Health Uncut

Sophisticated investors face a mix of challenges and opportunities over the next 12 months, from the disruption of legacy industries like automobiles and chips to geopolitical and economic pressures in regions like Western Europe and China. Key risks include AI-driven automation reshaping traditional sectors, rising energy demands conflicting with declining solar costs, and shifts in defense spending priorities. On the positive side, potential stabilization in U.S. debt growth, gradual recovery in commercial real estate, and moderating inflation and interest rates could offer relief. Explore these insights further in our latest Risk Commentary: https://lnkd.in/drG2GiPj #AI #AutoIndustry #Inflation Image credit: Bloomberg

Japan’s growing debt crisis has prompted government advisor Mana Nakazora to call on credit rating firms to issue warnings of potential downgrades to sovereign bonds. She believes such alerts could push policymakers to address deteriorating fiscal discipline. With a ¥13.9 trillion ($92 billion) stimulus package requiring significant bond issuance, Nakazora warns that Japan’s goal of achieving a primary balance surplus by 2025 is increasingly out of reach. Nakazora also criticized subsidies and handouts, urging greater public awareness of the long-term costs. As the BOJ nears an interest rate hike decision, she cautions that worsening fiscal conditions could complicate monetary policy. Credit rating firms, she suggests, have a vital role to play in sounding the alarm and driving reforms before it’s too late. #EganJones #JapanDebt #CreditRatings Image credit: CEIC Data 

Can credit ratings make EU bond markets more competitive? Big names like AFME, ICMA, and other leading industry groups believe so, and they’re urging the EU to follow the examples set by the US TRACE system and the UK FCA proposals. The challenge lies in addressing the fact that investment-grade (IG) corporate bonds face significantly more price volatility than high-yield (HY) bonds. Without a tailored approach, current transparency regimes may not provide the precision needed to support market efficiency. The proposed solution is integrating credit ratings into transparency frameworks. Credit ratings capture the differences in bond volatility, allowing for customized transparency levels that improve liquidity and better support issuers’ financing needs. Tools like ESMA’s European Rating Platform (ERP) could provide the foundation for this system, or the initiative could be driven by the industry itself through collaboration between investment firms and trading venues. By adopting this approach, the EU has the opportunity to modernize its bond markets, enhance liquidity, and remain competitive on the global stage. #EganJones #EUFinance #CreditRatings