The Impact of Rising Interest Rates on Credit Markets

The podcast episode discusses the impact of rising interest rates on credit markets. It explores the reasons behind the recent rise in interest rates, such as supply chain issues and increased demand due to stimulus measures. The central banks globally have been forced to follow a playbook of raising interest rates quickly to address the inflation push. The guest, Wayne Doll, from Oaktree, explains the definition of risk at Oaktree, emphasizing the importance of minimizing loss for investors. Despite the rise in interest rates, the default rates in credit markets have not surged as expected, partly due to the cleansing effect of the COVID-induced defaults. However, looking forward, there may be challenges ahead with the looming maturity wall and refinancing needs for companies in the coming years.