The $1 trillion US private credit market is watching its borrowers do something that would have been unthinkable a few years ago: shop for better deals in Europe.
The US default problem
The US private credit default rate hit 5.8% as of January 2026. Projections suggest the rate could climb to 8%, driven in part by disruptions that artificial intelligence is causing in the software and SaaS sectors.
A PwC survey found that 93% of credit managers in the US expect flat or declining returns in 2026.
Europe’s quiet ascendance
