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Bankruptcies soar as high rates and end of Covid aid hit businesses hard

Higher interest rates, along with the collapse of zombie companies that had survived on Covid-era government support, have fuelled the trend, according to Neil Shearing, chief economist at Capital Economics. Shearing cited “the cost of debt servicing” and “the rollback of pandemic support” as well as “high energy bills, particularly in energy-intensive sectors”. The industries suffering the most from the increased insolvency rates included transportation and hospitality, analysts said.

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