Investors look ahead to higher defaults as interest rates, inflation take a toll

Debt investors are betting that the Federal Reserve’s latest rate hike The recession is a prelude to some US companies as rising borrowing costs could impact consumer spending and increase spending for business.

The Federal Reserve on Wednesday announced a 0.75-percentage-point increase in the federal-funds rate, the central bank’s biggest rate hike since 1994. Fed projections released on Wednesday also showed policymakers expect rates to rise further as the year progresses.