Bloomberg Quotes Ranesh Ramanathan on Impact of Higher For Longer Interest Rates
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For its article “Troubled Borrowers Seen Fighting for Runway Without Fed Cuts,” Bloomberg quoted special situations & private credit practice co-leader Ranesh Ramanathan. The article discusses how companies previously expecting Federal Reserve cuts will now face higher-for-longer rates and evidence of strains are starting to show in lowest-rated debt.
“Today, everyone wants to amend and pretend because they believe it’s going to get better,” said Ranesh. “At some point, you can’t.”
Also troubling, key metrics such as interest coverage ratio, a measure of how much cash a company has available to pay its interest, are deteriorating, according to Ranesh.
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