The decline of credit quality in western Europe slowed in the first quarter of 2007 due to strong economic growth, especially in the financial sector. But an upturn in the credit cycle is not in sight this year, according to a report by Moody's Investors Service.
The upgrade-to-downgrade ratio rose to 0.84 over the quarter, from a low of 0.40 in the third quarter of 2006. This improvement was due to sustained appetite for risk and strong corporate cashflows, the report says.
The outlook for