3Q 2022 Investor Presentation
Macro Assumptions Underpinning Our Outlook¹
GDP Growth 2
1.0% 2.0% United States
1.5% 2.5% Euro area
2.0% 3.0% Global
Credit Spreads
Macroeconomic Assumptions¹
Benchmark rates to rise; U.S.
high yield spreads to fluctuate
between 500 - 600 bps, on
average, with periodic volatility
for the remainder of the year
Inflation & Unemployment
Global inflation levels to remain elevated
(U.S.: 7.0% 8.0%; Euro area: 8.0% -
10.0%); U.S. unemployment rate to rise
to -3.7% by year-end
Default Rates
Global high yield default
rate to rise to 2.5% -
3.5% by year-end
$ € FX Rates
$1.12 and $0.98 for the
remainder of the year for
USD/GBP and USD/EUR
FX rates, respectively
TAILWINDS
HEADWINDS
Continued, though slowing, global GDP growth
✗
Recessionary concerns influencing consumer and business behavior
~$4T of refinancing needs between 2023 and 2026
✗
Expectation for USD to maintain its strength throughout 2022
Investor demand remains for higher-rated credits, despite expected
interest rate increases
✓
interest rate increases
Global inflation at a 40-year high; hawkish Central Bank policies leading to
Strong credit performance and low default rates
Х
Russia-Ukraine crisis impacting commodity prices, supply chains and
market sentiment
✗ High cash levels on corporate balance sheets
Source: Default rate and unemployment assumptions sourced from Moody's Investors Service "September 2022 Default Report", published October 19, 2022. High yield spreads, GDP and inflation assumptions as of October 25, 2022, from
Moody's Investors Service.
1. Guidance as of October 25, 2022. Refer to Table 11 - "2022 Outlook" in the press release titled "Moody's Corporation Reports Results for Third Quarter 2022" from October 25, 2022, for a complete list of guidance, reconciliations between
adjusted and organic measures and U.S. GAAP, as well as assumptions used by the Company with respect to its guidance.
2. GDP Growth represents real GDP.
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3Q 2022 Investor Presentation
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