“I think it’s not surprising to me at all,” Mr. Leung said. “People have been looking at what’s been happening to the whole economy, and the actions being taken by central banks, and it’s starting to have its predictable effects.”
By region, Europe’s Aggregate Credit Default Outlook index remained the lowest among all regions due to its proximity to the crisis in Ukraine, at -88.6, barely above its rating of -91.2 the previous quarter.
North America’s index rose to -78.9 from -88.9; Asia rose to -68.2 from -82.6; and Australia’s index to -56.3 from -71.4.
Survey respondents also forecast wider credit spreads over the next three months. The second-quarter survey had seen the consensus for spreads plummet from the previous quarter, and while the level of pessimism steadied during the third quarter, managers still remained gloomy.
While the index for investment-grade fixed income in North America rose to -40.6 for the latest survey, up from -69 three months earlier, sentiment for investment-grade fixed income in Europe worsened, with the index lowering to -64.5 from -63.3.
The index reading for North American high-yield debt rose to -59.4 from -78.6 in the first quarter, while the index reading for European high-yield debt rose to -66.7 from -69.
The survey is conducted among IACPM members, who are credit portfolio managers at more than 100 financial institutions in the U.S., Europe, Asia, Africa and Australia.
