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    Weekly Market Outlook: Lowest Investment-Grade Industrial Company Bond Yields since 1956

    The latest rally by Treasury bonds drove Moody's long-term industrial company bond yields down to new 63-year lows. On August 14, the single-A industrial company bond yield closed at 3.30% and the Baa industrial yield ended at 4.08%.

    August 2019 Pdf John Lonski, Yukyung Choi, Katrina Ell, Barbara Teixeira Araujo, Ryan Sweet, Michael Ferlez

    Asia Economic Outlook: Navigating Uncertainty

    The global economy is navigating troubled waters. The unresolved and significant geopolitical risks plaguing the global economy are exacerbating the slowdown in demand.

    August 2019 Pdf Steven Cochrane, Katrina Ell

    Household Credit Conditions Never Better

    More than a decade after the financial crisis that was caused in significant part by debt-burdened households, there is no indication that household debt will be at the center of the next economic recession.

    August 2019 Pdf Mark Zandi

    Will CECL Ultimately Be Worth All the Fuss?

    The industry is currently a hive of CECL-related activity. Many banks are busily testing their systems or finalizing their preparations for the go-live date, which is either in January 2020 or somewhat later, depending on the organization. Some are still making plans for implementation, and the rest are worried that they should be.

    August 2019 Pdf Dr. Tony Hughes

    Reasonable and Supportable Forecasts - From Principles to Practice

    With many of the larger SEC filers well ahead in their CECL preparations and gearing up for validation, we examine how the requirements of an R&S forecast and reversion may be interpreted.

    Weekly Market Outlook: Sluggish Business Revenues Pressure Corporate Credit Quality

    It was a tumultuous week. Volatility will lurk until trade issues are resolved. Perhaps the best markets can hope for on the trade front is a long-lived truce.

    August 2019 Pdf John Lonski, Yukyung Choi, Katrina Ell, Barbara Teixeira Araujo, Ryan Sweet, Steven Shields

    The Ebb and Flow of Free Trade

    We demonstrate how the pattern of trade and the rules that have governed trade have changed dramatically over the past two years from a system that was set up shortly after World War II and that more or less thrived until the current trade war.

    August 2019 Pdf Steven Cochrane, Faraz Syed

    Living in the Tail Risk: US/China Trade War

    The US-China trade war has gone down a darker path. The trade war has escalated beyond expectations and the stakes are high for the global economy.

    August 2019 Pdf Steven Cochrane, Katrina Ell

    Weekly Market Outlook: Successful Rate Cuts Are Short and Shallow; Failures Are Deep and Extended

    Since 1984, there have been seven distinct series of Fed rate cuts. Four of the seven rate cut episodes occurred amid a mature business cycle upturn and managed to stave off a recession. They happened in 1985, 1987, 1995, and 1998.

    August 2019 Pdf John Lonski, Yukyung Choi, Katrina Ell, Barbara Teixeira Araujo, Ryan Sweet, Michael Ferlez

    Weekly Market Outlook: Faster Loan Growth Would Bode Poorly for Corporate Credit Quality

    Forecasts of a prolonged depreciation of the dollar exchange rate may be overlooking to the increased importance of U.S. spending as a driver of global economic growth.

    July 2019 Pdf John Lonski, Yukyung Choi, Katrina Ell, Ryan Sweet, Brendan Meighan, Steven Shields

    Waters Rankings 2019: Best Reporting System Provider

    Regulatory reporting has emerged in recent years as a critical business function that needs to be managed accurately, efficiently and transparently, even though it is an area where capital markets firms tend not to be able to leverage as a competitive differentiator.

    July 2019 WebPage

    Weekly Market Outlook: Likelihood of a 1.88% Fed Funds Rate by End of July Soars

    The release of second quarter corporate earnings is moving into full gear and investors are not entirely happy with the results.

    July 2019 Pdf John Lonski, Yukyung Choi, Katrina Ell, Steven Cochrane, Barbara Teixeira Araujo, Michael Ferlez, Ryan Sweet

    The Real Value of Stress Testing: Has CCAR Been Validated?

    The theory that banks are now safer because of CCAR, though, has not yet been tested.

    July 2019 Pdf Dr. Tony Hughes

    Weekly Market Outlook: Market Implied Ratings Differ on the Likely Direction of Baa3 Ratings

    Baa3-grade issuers constitute the bottom rung of the investment-grade ratings ladder. Once a Baa3 rating is subject to a “fallen angel” downgrade to speculative-grade, investors who are mandated to hold only investment-grade obligations must sell the now high-yield debt.

    July 2019 Pdf John Lonski, Yukyung Choi, Katrina Ell, Barbara Teixeira Araujo, Ryan Sweet, Steven Shields

    Potential Output and Monetary Neutrality in Chile

    Based on an update of the economy's structural variables, the Central Bank of Chile relaxed monetary conditions in June. Using statistical methods, we arrived at the same conclusion in terms of Chile's potential output; however, the estimation of monetary neutrality changes significantly with the new methodology to compute inflation and with the change in expectations of the monetary policy rate. The high sensitivity of estimates of non observable variables––such as potential output and neutral interest rate––can lead to monetary decisions that may become inconsistent.

    July 2019 Pdf Alfredo Coutiño

    LatAm Central Bankers Bask in Fed Pause

    Rate cut or not, the Federal Reserve's easing bias is a relief for the region.

    June 2019 Pdf Jesse Rogers

    Economic Implications of Climate Change

    We examine the physical risk and quantify the economic costs of climate change using the Moody's Analytics Global Macroeconomic Model.

    June 2019 Pdf Mark Zandi

    Weekly Market Outlook-Below-Trend Spreads Bank on Profits Growth, Lower Rates and Healthy Equities

    Sequential declines by the Bureau of Economic Analysis' quarterly estimate of nonfinancial-corporate profits from current production, or core pretax profits, often reveal little about the current or future states of the business and credit cycles.

    June 2019 Pdf John Lonski, Yukyung Choi, Katrina Ell, Barbara Teixeira Araujo, Ryan Sweet, Michael Ferlez

    Risk Technology Awards 2019: Enterprise-wide Stress-testing product of the year

    Stress‑testing plays an important role in enhancing risk management practices. However, it requires significant co‑ordination and participation, and banks must optimise their resources, technology and data to ensure they can respond quickly to management and regulatory requests.

    June 2019 WebPage

    Risk Technology Awards 2019: IFRS 9 Enterprise & ECL Solution of the Year

    The credit loss and impairment analysis demanded by the International Financial Reporting Standard (IFRS) 9 and Current Expected Credit Loss (CECL) accounting standards requires appropriate data, risk parameters and models, and a platform to perform the calculations in an automated manner.

    June 2019 WebPage

    Risk Technology Awards 2019: Bank ALM System of the Year

    As financial markets become more complex and integrated, understanding linkages requires a multidisciplinary perspective. Moody's Analytics' RiskConfidence enterprise system offers integrated asset‑ liability management (ALM), funds transfer pricing (FTP), liquidity risk management, and business and regulatory reporting

    June 2019 WebPage

    Risk Technology Awards 2019: Credit Data Provider of the Year

    Accounting and regulatory requirements for financial institutions demand transparency in credit risk metric calculations, adequate data quality and robust model development data often spanning full credit cycles.

    June 2019 WebPage

    Risk Technology Awards 2019: Wholesale Credit Modelling Software of the Year

    The Moody's Analytics suite of wholesale credit scoring models and solutions cover the market from small businesses to large private and public companies, to commercial real estate and project finance. Applications include pre‑qualification, origination, counterparty risk assessment, benchmarking,

    June 2019 WebPage

    Weekly Market Outlook: Global Collapse by Bond Yields Stems From Worldwide Slowdown

    Both the corporate bond and equity markets responded positively to the latest drop by Treasury bond yields and the likelihood of at least two reductions of the federal funds rate during the remainder of 2019.

    June 2019 Pdf John Lonski, Yukyung Choi, Katrina Ell, Barbara Teixeira Araujo, Mark Zandi, Ryan Sweet, Steven Shields

    CECL, IFRS 9 and the Demand for Forecast Stability

    Loan-loss provisioning models must take a variety of economic and client factors into account, but, with the right approach, banks can develop sensible loss forecasts that are more accurate and less susceptible to volatility.

    June 2019 WebPage Dr. Tony Hughes

    Leveraging Historical Loss Data for CECL

    This paper explores the CECL standard's background, the choices community banks, regional banks, and credit unions face, and some suggested approaches for dealing with these challenges.

    June 2019 WebPage Laurent Birade, Dr. Yashan Wang, Warren Xu

    Weekly Market Outlook: Borrowing Restraint Likely Despite Lower Interest Rates

    According to the Federal Reserve's “Financial Accounts of the United States”, first-quarter 2019's outstanding debt of U.S. nonfinancial corporations advanced by 8.1% year-over-year to a new record high of $9.926 trillion.

    June 2019 Pdf John Lonski, Yukyung Choi, Katrina Ell, Brendan Meighan, Steven Shields

    Chile Reverses on Monetary Normalization

    The policy rate was cut based on a new estimation of the output gap.

    June 2019 Pdf Alfredo Coutiño

    The Belt and Road Initiative—Six Years On

    Using the Moody's Analytics Global Macroeconomic Model to estimate the potential impact of BRI-related investments on Southeast Asian countries.

    June 2019 Pdf Steven Cochrane, Veasna Kong, Brendan Meighan

    Climate Change Stress Testing

    As evidence of climate change builds and threats materialize,data will be invaluable in creating a framework for making future credit decisions.

    June 2019 Pdf Dr. Tony Hughes
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