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Fed flags high U.S. business debt, asset prices in financial report
Source: Reuters
BUSINESS NEWS MAY 6, 2019 / 3:05 PM / UPDATED AN HOUR AGO
Fed flags high U.S. business debt, asset prices in financial report
WASHINGTON (Reuters) - U.S. stock prices are “elevated” and business debt is at historic levels, but the financial system overall “appears resilient” with low levels of leverage and less of a destabilizing run in key markets, the Federal Reserve said in its latest report on financial stability.
“Investor appetite for risk appears elevated by several measures, and the debt loads of businesses are historically high,” the Fed said on Monday in a report that noted the 20 percent growth in leveraged loans between the start of last year and this year, and other aspects of corporate debt.
The ratio of debt to assets among publicly traded, nonfinancial firms is near a 20-year high, the Fed noted, and the share of new loans going to the most indebted companies is near peaks reached in 2014 and just before the 2007 to 2009 financial crisis.
While the Fed sees the system overall as healthy, the levels of corporate debt stand out, said Fed Governor Lael Brainard.
-snip-
Fed flags high U.S. business debt, asset prices in financial report
WASHINGTON (Reuters) - U.S. stock prices are “elevated” and business debt is at historic levels, but the financial system overall “appears resilient” with low levels of leverage and less of a destabilizing run in key markets, the Federal Reserve said in its latest report on financial stability.
“Investor appetite for risk appears elevated by several measures, and the debt loads of businesses are historically high,” the Fed said on Monday in a report that noted the 20 percent growth in leveraged loans between the start of last year and this year, and other aspects of corporate debt.
The ratio of debt to assets among publicly traded, nonfinancial firms is near a 20-year high, the Fed noted, and the share of new loans going to the most indebted companies is near peaks reached in 2014 and just before the 2007 to 2009 financial crisis.
While the Fed sees the system overall as healthy, the levels of corporate debt stand out, said Fed Governor Lael Brainard.
-snip-
Read more: https://www.reuters.com/article/us-usa-fed-stability/fed-flags-high-u-s-business-debt-asset-prices-in-financial-report-idUSKCN1SC1XN
