Who defaults more?

Sovereigns are showing lower default rates than corporates, according to Moody's Investors Service.
Default rates for sovereign domestic and foreign currency bond issuers have been lower than those for similarly rated corporate issuers, according to Moody's Investors Service.

It looked at default and recovery rates for sovereign bond issuers between 1983 and 2005. The ratings agency also found that the average debt recovery rate on defaulted sovereign bonds has been higher.

Credit migration rates of sovereign bond issuers have been very similar to those of corporate issuers, but default rates for sovereign issuers have been lower than those for similarly rated corporates, says Moody's Vice President Praveen Varma. This is true for both investment-grade and speculative-grade issuers, and over both five-year and 10-year horizons.

Moody's notes that for...
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