Are high yield bonds ready to face a recession?

The imminent recession is set to be driven purely by inflation, as opposed to the typical credit-driven stance seen previously, leaving high-yield issuers open to a growing set of issues. This means more protection must be taken to weather the upcoming downturn. The increasing strength of corporate balance sheets adds a new layer of defence for these issuers, meaning the asset class should be in a healthy position ahead of looming troubles. T. Rowe Price Portfolio Manager, Michael Della Vedova, and Fixed Income Specialist, Stephen Marsh, identify three key factors that help explain why high...